Multiple Choice
Which of the following industries typically has the highest supply chain cost as a percentage of sales?
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0. Basic Principles of Economics
Introduction to Economics
Multiple Choice
Which of the following is NOT one of the forces in Porter's Five Forces model?
A
Threat of new entrants
B
Bargaining power of suppliers
C
Market equilibrium
D
Threat of substitute products
Verified step by step guidance1
Step 1: Understand Porter's Five Forces model, which is a framework used to analyze the competitive forces within an industry that affect its profitability.
Step 2: Recall the five forces in the model: (1) Threat of new entrants, (2) Bargaining power of suppliers, (3) Bargaining power of buyers, (4) Threat of substitute products or services, and (5) Industry rivalry or competitive rivalry.
Step 3: Review the options given: 'Threat of new entrants', 'Bargaining power of suppliers', 'Market equilibrium', and 'Threat of substitute products'.
Step 4: Identify which option does not belong to the five forces. 'Market equilibrium' is an economic concept describing supply and demand balance, not a force in Porter's model.
Step 5: Conclude that 'Market equilibrium' is NOT one of the forces in Porter's Five Forces model.
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