Which of the following best defines the term 'market power'?

The term 'market power' is best defined as the ability to dictate terms of trade in the market. This concept refers to the capability of a firm or organization to influence the price and quantity of goods or services in the market. When a company holds significant market power, it can set prices above the competitive level, control supply and demand dynamics, and impose certain conditions on buyers and sellers. This authority stems from factors such as brand strength, customer loyalty, and lack of competition.

The other definitions do not encompass the full scope of what market power signifies. The capacity to raise prices without losing customers is a consequence of market power rather than its definition. Financial resources available for marketing are critical for promotional activities but do not directly correlate with the concept of market power. Lastly, the volume of sales generated annually may indicate a company's market position, but it does not specifically speak to its power to influence market conditions or prices.