The firm's added value is measured as that portion of the value created in the transaction involving the firm minus the total value that could be created if the firm did not exist. When will the added value be zero even if the firm did not take part in the exchange?
A) When the suppliers do not want to negotiate
B) When the competitors offer perfect substitutes of your products with the same supplier opportunity cost
C) When the firm cost is equal to supplier opportunity cost
D) When customer willingness to pay is equal to price
E) Added value will never be zero

Question

Quizplus · Accepted Answer

When competitors offer perfect substitutes of your products with the same supplier opportunity cost, the firm's absence wouldn't change the total value created in the transaction, making its added value zero.

The Firm's Added Value Is Measured as That Portion of the Value