Question: Firm X makes a specialized component that serves as an input into making a car and increases a car's reliability. Firm X has patented the

Firm X makes a specialized component that serves as an input into making a car and increases a car's reliability. Firm X has patented the technology for the component and hence has an

80 %

market share for that component. Car manufacturers pay a high premium for this component. As a result, car manufacturers realize

____

Group of answer choices

low profit margins due to high bargaining power of their supplier.

low profit margins due to high rivalry in the car industry.

high profit margins due to low bargaining power of buyers.

high profit margins due to minimal threat of product substitution.

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