Question 9 Concentration ratios measure the: geographic location of the largest corporations in each industry. degree to which product price exceeds marginal cost in various industries percentage of total industry sales accounted for by the largest firms in the industry. number of firms in an industry.
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Concentration ratios are used in economics to analyze market structure. Show more…
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What is an important shortcoming of a four-firm concentration ratio as a measure of industry concentration? a. It completely ignores the sales of firms not among the top four firms. b. It fails to account for total industry sales in each reporting time period during the study. c. It cannot distinguish between an industry with a single dominant firm and an industry with four powerful firms. d. The text says, instead, that the ratio has no discernible shortcomings.
Sanchit J.
What is an important shortcoming of a four-firm concentration ratio as a measure of industry concentration? Select the most appropriate option: a. It completely ignores the sales of firms not among the top four firms. b. It fails to account for total industry sales in each reporting time period during the study. c. It cannot distinguish between an industry with a single dominant firm and an industry with four powerful firms. d. The text says, instead, that the ratio has no discernible shortcomings.
To measure the degree of market concentration in an industry, a concentration ratio can be applied only if _____. a. two or at most three firms compete in the industry being studied b. the researcher first selects the number of the largest firms as a basis for comparison c. each of the three largest firms has an equal share of industry sales d. at least 10 firms offer product for sale in the industry
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