There Are 30 Firms in an Industry

question 54

Multiple Choice

There are 30 firms in an industry. What happens to that industry's four-firm concentration when the third- and fourth-largest firms merge?

• A) Nothing, because their shares are already included in the concentration calculation.
• B) The industry's concentration ratio will fall.
• C) The industry's concentration ratio will increase.
• D) It is impossible to know without more information.

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Definitions:

Probability Model

A mathematical representation of a random phenomenon, characterized by its sample space, events within the sample space, and probabilities associated with each event.

Resonance Stabilization

A phenomenon where a molecule can be represented by two or more structures that contribute to its overall stability and properties, enhancing its chemical stability.

Phenoxide Ion

The phenoxide ion is a negatively charged ion (an anion) formed when phenol loses a hydrogen ion (H+), characterized by a phenyl group (C6H5) bound to an oxygen atom carrying a negative charge.

Cyclohexanol

A secondary alcohol with the formula C6H11OH, characterized by a six-member ring structure, and used as a precursor in the production of nylon.