The situation in which buyers are able to affect the price of a good is referred to as ________ power.

Question

Quizplus · Accepted Answer

Monopsony power is the situation in which buyers, rather than sellers, have some control over the market and are able to affect the price of a good. This can happen when a single buyer or a group of buyers hold a significant portion of the market share, giving them the ability to negotiate lower prices or demand better terms from sellers. Monopsony power is the opposite of monopoly power, which refers to the situation in which a single seller has significant control over the market and can affect the price of a good. Purchasing power refers more broadly to a consumer's ability to buy goods and services, and countervailing power refers to the balancing of power between buyers and sellers.

The Situation in Which Buyers Are Able to Affect the Price