As a General Rule, Oligopoly Exists When the Four-Firm Concentration

question 8

Multiple Choice

As a general rule, oligopoly exists when the four-firm concentration ratio

• A) equals the Herfindahl index.
• B) yields a Herfindahl index below 500.
• C) is 40 percent or more.
• D) is 50 percent or more.

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Definitions:

Amortized

The process of gradually reducing the cost of an intangible asset through systematic charges to expense over its useful life.

Brokerage Commission

The fee charged by a broker for facilitating transactions between buyers and sellers.

Accrued Interest

The interest that has been earned but not yet paid or received in cash.

Investment In Bonds

The act of purchasing debt securities issued by corporations or governments, aiming to earn interest income and potentially benefit from price appreciation.