Suppose That Total Sales in an Industry in a Particular

question 40

Multiple Choice

Suppose that total sales in an industry in a particular year are $800 million and sales by the top four sellers are $50 million, $40 million, $30 million, and $30 million, respectively. We can conclude that

• A) this industry is an oligopoly.
• B) this industry is monopolistically competitive.
• C) the concentration ratio is 25 percent.
• D) firms in this industry likely collude with each other.

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Definitions:

Complicated Tasks

Tasks that are multifaceted and complex, requiring significant mental effort, skill, or resources to complete successfully.

Social Compensation Effects

The phenomenon whereby individuals work harder in a group to compensate for the perceived lower performance of others.

Collective Effort Model

A theoretical framework that suggests individual motivation in group tasks is influenced by the expected outcomes of the collective effort.

Kohler Effect

A phenomenon where less capable members of a group perform better when working collectively than when working alone.