The Following Table Shows the Four-Firm Concentration Ratios for Five

question 136

Multiple Choice

The following table shows the four-firm concentration ratios for five separate industries.Use this table to answer the following questions:

-In which industry do the four largest firms collectively have the most market power?

• A) beer brewing
• B) breakfast cereals
• C) chocolate confections
• D) adhesive manufacturing
• E) plastics product manufacturing

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Definitions:

Common Stock

Equity ownership in a corporation, giving holders voting rights and a share in the company’s profits through dividends.

Par Value

The face value of a bond or stock as stated by the issuing company, which does not necessarily match its market value.

Common Stock

Equity securities representing ownership in a corporation, giving shareholders voting rights and a share in the company's profits through dividends.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, often receiving dividends before common shareholders.