The profits earned by firms in an industry,are determined by:
A)The overall state of the economy and the intensity of competition within the industry
B)How much customers value the products supplied by the industry
C)The extent to which the industry is protected by barriers to entry
D)The value of the product for customers,the intensity of competition,and the relative bargaining powers of producers,their suppliers and their buyers

Question

Quizplus · Accepted Answer

The profits earned by firms in an industry are dependent on multiple factors, such as the value of the product for customers, the intensity of competition, and the relative bargaining powers of producers, their suppliers, and their buyers. These factors collectively determine the profitability of a firm in a given industry. Therefore, option D is the best choice as it covers all the possible determinants of profits earned by firms. The other options A, B, and C include only a few determinants or a generalized statement, which is not sufficient to determine the profits earned by firms in an industry.

The Profits Earned by Firms in an Industry,are Determined By