Final answer:
Buyers tend to have less power in markets where there are fewer suppliers, products are undifferentiated, purchases are a small part of their costs, or they are not earning significant economic profits. This is seen in monopoly and oligopoly conditions.
Step-by-step explanation:
The question is addressing the concept of buyer power in different market structures such as monopoly, oligopoly, and perfectly competitive markets. Buyers tend to have less power when:
- (A) A firm has only one buyer, or a small number of buyers, often seen in monopoly or oligopoly markets where large firms dominate and the choices for buyers are limited.
- (B) The products or services being sold to buyers are standard and not differentiated, meaning buyers cannot use the quality or uniqueness of a product to demand lower prices.
- (C) The supplies they purchase are an insignificant portion of the costs of their final products, hence buyers cannot leverage high volume purchases for price discounts.
- (D) They are not earning significant economic profits, limiting their ability to negotiate or switch suppliers without impacting their bottom line significantly.
These factors contribute to a reduction in the power that buyers have to influence prices and terms.