One measure of the extent of competition in an industry is the concentration ratio. What level of concentration indicates that an industry isan oligopoly?Most economists believe that a four-firm concentration ratio of greater than 40 percent indicates that an industry is an oligopoly. (Enter yourresponse as an integer.)Is the concentration ratio an accurate measure of the extent of competition?The four-firm concentration ratioOA. is flawed in that it is calculated for local markets even though competition in some industries is national.○ B. is accurate because it is based on national and global competition.○ C. is flawed in that it includes sales in the U.S. by foreign firms.D. is accurate because it is based on estimates from the U.S. Census Bureau.E. is flawed in that it does not measure competition between industries.

Question 1: Threshold for an OligopolyWhat level of concentration indicates that an industry is an…

Answered: One measure of the extent of…

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter15: Oligopoly And Strategic Behavior

Section: Chapter Questions

Problem 6P

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Compare the quantity and price of an oligopoly tothose of a perfectly competitive market.
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