Question

The number of suppliers that enter and leave the market has no effect on the amount of goods or services supplied.

Answer 1

Answer:

False.

Explanation:

The number of suppliers is determinant in the goods or services supplied. According to Michael Porter's Law, this has a direct effect. Because, if the number of suppliers is high, their power to negotiate is low, and this affects the good or services they offer. But, if the number of suppliers is low, then they are going to have a higher negotiation power.

Another event the typically lows the suppliers power of negotiation is the substitute product.

So, at the end, there are three variables that ensure that the effect is going to be present.

Answer 2

False. The number of suppliers that enter or leave the market will cause it to either decline or rise.