Suppose Each of the 50 States Had Only One Gasoline

question 105

Multiple Choice

Suppose each of the 50 states had only one gasoline station,and all stations were the same size.The four-firm concentration ratio a consumer would experience is:

• A) 1.0.
• B) 0.08.
• C) 0.32.
• D) 0.16.

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Definitions:

Competitive Labor Market

A competitive labor market is characterized by numerous employers and workers where no single entity has the power to influence wages, ensuring efficient allocation of labor.

Monopsonist

A market situation where there is only one buyer for many sellers, giving the single buyer significant control over prices and terms of purchase.

Competitive Labor Market

A market scenario where numerous buyers (employers) and sellers (workers) freely interact to determine the wages and employment conditions without significant restrictions or monopoly power.

Profit-Maximizing Level

The production output level at which a business achieves the highest possible profit, where marginal cost equals marginal revenue.