Economies of scale and scope, cost complementarity, and patents are all sources of which type of power?

• A. political
• B. market
• C. consumer
• D. labor

Answer: (B)

Verified step by step guidance

1. Step 1: Understand the key terms in the question: Economies of scale refer to cost advantages that a firm obtains due to expansion, economies of scope refer to cost advantages from producing a variety of products together, cost complementarity means that producing goods jointly reduces costs, and patents provide legal protection that can limit competition.
2. Step 2: Recognize that these concepts relate to a firm's ability to influence its competitive environment and pricing, which is a characteristic of market power.
3. Step 3: Differentiate market power from other types of power such as political power (influence over government), consumer power (influence by buyers), and labor power (influence by workers).
4. Step 4: Conclude that economies of scale, economies of scope, cost complementarity, and patents are all sources that enable a firm to have market power by reducing costs or limiting competition.
5. Step 5: Therefore, the correct classification of these sources is 'market power'.