Question

If a supplier has high power what can it do to influence its industry?

A. Charge higher prices.
B. Shift costs to industry participants.
C. Limit quality or services.
D. All of the above.

Answer 1

When a supplier has high power in an industry, they can influence it by charging higher prices, shifting costs to industry participants, and limiting quality or services. Therefore, the correct answer is D. All of the above.

Step-by-step explanation:

When a supplier has high power, it means that they can influence their industry to a significant extent. In this case, options A, B, and C are all correct. Let's go through each one:

1. Charge higher prices: When a supplier has high power, they may be able to charge higher prices for their products or services. This is because they have limited competition and can demand higher prices from industry participants.
2. Shift costs to industry participants: Another way that a supplier with high power can influence its industry is by shifting costs to industry participants. This can be done through various means, such as increasing the price of raw materials or passing on additional expenses to industry participants.
3. Limit quality or services: Finally, a supplier with high power can also limit the quality or services provided to industry participants. By providing subpar quality or reducing the level of service, they can exert control over the industry and maintain their position of power.

Therefore, the correct answer is D. All of the above.