Consider an Industry That Is Made Up of Nine Firms

question 179

Multiple Choice

Consider an industry that is made up of nine firms, each with a market share (percent of sales) as follows:
A.Firm A: 30%
B.Firm B: 20%
C.Firms C, D, and E: 10% each
D.Firms F, G, H, and J: 5% each
What is the value of the four-firm concentration ratio and how is the industry categorized?

• A)50%; monopolistic competition
• B)70%; oligopoly
• C)75%; oligopoly
• D)80%; strongly oligopolistic

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Definitions:

Golden Age

A period in history marked by peace, prosperity, and cultural achievements, often idealized or considered a pinnacle in a civilization's history.

Stable Prices

A situation in the economy where prices of goods and services remain consistent over time without significant inflation or deflation.

Trade Surplus

A situation where a country's exports exceed its imports over a certain period, leading to a positive balance of trade.

Economic Engines

Key industries or sectors within an economy that drive economic growth, employment, and wealth generation.