Compute the four-firm concentration ratio

Assignment Help Business Economics

Reference no: EM131003598

Consider two industries, each comprising ten firms. In industry A, the largest firm has a market share of 49 percent. The next three firms have market shares of 7 percent each, and the remaining six firms have equal shares of 5 percent each. In industry B, the top four firms share the bulk of the market with 19 percent apiece. The next largest firm accounts for 14 percent, and the smallest five firms equally split the remaining 10 percent of the industry.

a. Compute the four-firm concentration ratio and HI for each industry. Compare these measures across the two industries. Which industry do you think truly exhibits a more competitive structure? Which measure do you think gives a better indication of this? Explain.

b. Now let the three second largest firms in industry A merge their operations while holding onto their combined 21 percent market share. Recalculate the HI for industry A.

Reference no: EM131003598

Questions Cloud

Who will have the final authority : Your textbook poses the following question on page 277: "Who will have the final authority if the human and computer disagree about the proper control actions in a given system task?"

The required disclosures in the notes to financial statement : The required disclosures in the notes to financial statements for the components of income tax expense.

Relative rates of growth in a natural environment : Contrast the relative rates of growth in a natural environment vs lab culture Biofilms: what they are, generally how formed, and main types of issues they can cause for humans Soils: note the variability of environmental conditions (water, O2) in bot..

Outward flow of immigrants that decreases its labor force : Examine the impact on a small country following an outward flow of immigrants that decreases its labor force. Assume that land is specific to agriculture and capital is specific to manufacturing, while labor is free to move between the two sectors.

Compute the four-firm concentration ratio : Consider two industries, each comprising ten firms. In industry A, the largest firm has a market share of 49 percent. The next three firms have market shares of 7 percent each, and the remaining six firms have equal shares of 5 percent each. Compute ..

What is the deferred tax liability at december : What is the deferred tax liability at December 31, 2012 (rounded to the nearest whole dollar)?a. $ 7,000b. $33,330c. $11,667d. $ 4,667

What is the cost of removing of the heavy metals : What is the cost of removing 90% of the heavy metals? Evaluate limx→100- C (x). Write a sentence to interpret your result in part (b). Also explain why limx→100+ C (x) can not be considered.

Who gains and who loses from a tariff : Guided Response: Review the discussion board posts of your classmates. Note their analysis of those who gain and lose from a tariff. Respond to at least two of your classmates. Compare your classmates' analyses on using tariffs vs. quotas by compa..

Compute the rate of return for this investment : A project has an initial cost of $160,000 and an estimated salvage value after 14 years of $100,000. Estimated average annual revenues are $28,000. Estimated average annual costs are $16,000. Assuming that annual revenues and costs will be uniform, c..

User Account

All Pages