MICROECONOMICS-ACCESS CARD <CUSTOM>
11th Edition
ISBN: 9781266285097
Author: Colander
Publisher: MCG CUSTOM
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Chapter 15, Problem 8QE
To determine
Find the highly concentrated industry.
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The Costa Rican gimble industry consists of 14 firms whose annual sales are as shown in the table below: \table[[Firm,
Sales (in millions)], [A, 4], [B, 8], [C, 12], [D, 18], [E, 23], [F, 17], [Next eight firms (total), 18]] a. What is the (four-) firm
concentration ratio for this industry? Four firm concentration: % b. In what type of market does the gimble industry
operate? Market type:
c
The Costa Rican gimble industry consists of 14 firms whose annual sales are as shown in the table below:
Firm
A
Sales (in millions)
4
B
C
D
E
F
Next eight firms (total)
8
12
18
23
17
18
a. What is the (four-) firm concentration ratio for this industry?
Four firm concentration:
%
b. In what type of market does the gimble industry operate?
Market type: (Click to select)
v
Assume there are six companies in a certain industry. Four companies have $10 sales apiece, while two companies have $5 sales each. What is the industry's four-firm concentration ratio?
Suppose an industry is composed of six firms. Four firms have sales of $10 each, and two firms haves sales of $5 each. What is the four-firm concentration ratio for this industry?
calculate HHI for this industry?
Chapter 15 Solutions
MICROECONOMICS-ACCESS CARD <CUSTOM>
Ch. 15.1 - Prob. 1QCh. 15.1 - Prob. 2QCh. 15.1 - Prob. 3QCh. 15.1 - Prob. 4QCh. 15.1 - Prob. 5QCh. 15.1 - Prob. 6QCh. 15.1 - Prob. 7QCh. 15.1 - Prob. 8QCh. 15.1 - Prob. 9QCh. 15.1 - Prob. 10Q
Ch. 15 - Prob. 1QECh. 15 - Prob. 2QECh. 15 - Prob. 3QECh. 15 - Prob. 4QECh. 15 - Prob. 5QECh. 15 - Prob. 6QECh. 15 - Prob. 7QECh. 15 - Prob. 8QECh. 15 - Prob. 9QECh. 15 - Prob. 10QECh. 15 - Prob. 11QECh. 15 - Prob. 12QECh. 15 - Prob. 13QECh. 15 - Prob. 14QECh. 15 - Prob. 15QECh. 15 - Prob. 16QECh. 15 - Prob. 17QECh. 15 - Prob. 18QECh. 15 - Prob. 1QAPCh. 15 - Prob. 2QAPCh. 15 - Prob. 3QAPCh. 15 - Prob. 4QAPCh. 15 - Prob. 5QAPCh. 15 - Prob. 1IPCh. 15 - Prob. 2IPCh. 15 - Prob. 3IPCh. 15 - Prob. 4IPCh. 15 - Prob. 5IPCh. 15 - Prob. 6IPCh. 15 - Prob. 7IP
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- Suppose an industry is composed of six firms. Four firms have sales of $10 each, and two firms have sales of $5 each. What is the four-firm concentration ratio for this industry?arrow_forwardThe four-firm concentration ratios for industries X and Y are 81 percent and 74 percent, respectively, while the corresponding Herfindahl-Hirschman indexes are 3,100 and 1,600. The Dansby-Willig performance index for industry X is 0.7, while that for industry Y is 0.55. Based on this information, which would lead to the greater increase in social welfare: a slight increase in industry X’s output or a slight increase in industry Y’s output?arrow_forwardBased on the information given, indicate whether the following industry is best characterized by the model of perfect competition, monopoly, monopolistic competition, or oligopoly. Explain! Industry A has a four-firm concentration ratio of 0.005 percent and a Herfindahl-Hirschman index of 75. A representative firm has a Lerner index of 0.45 and a Rothschild index of 0.34. Industry B has a four-firm concentration ratio of 0.0001 percent and Herfindahl-Hirschman index of 55. A representative firm has a Lerner index of 0.0034 and Rothschild index of 0.00023.arrow_forward
- Based on the information given, indicate whether the following industry is best characterized by the model of perfect competition, monopoly, monopolistic competition, or oligopoly a. Industry A has a four-firm concentration ratio of 0.005 percent and a HerfindahlHirschman index of 75. A representative firm has a Lerner index of 0.45 and a Rothschild index of 0.34. b. Industry B has a four-firm concentration ratio of 0.0001 percent and HerfindahlHirschman index of 55. A representative firm has a Lerner index of 0.0034 and Rothschild index of 0.00023 c. Industry C has a four-firm concentration ratio of 100 percent and HerfindahlHirschman index of 10,000. A representative firm has a Lerner index of 0.4 and Rothschild index of 1.0. d. Industry D has a four-firm concentration ratio of 100 percent and HerfindahlHirschman index of 5,573. A representative firm has a Lerner index equal to 0.43 and Rothschild index of 0.76.arrow_forwardThere are only two driveway paving companies in a small town, Asphalt, Inc. and Blacktop Bros. The inverse demand curve for the services is ? = 2040 − 20?where quantity is measured in pave jobs per month and price, in dollars per job. The firms have an identical marginal cost of $200 per driveway. If the two firms collude, splitting the work and profits evenly, how many driveways will each firm pave, and at what price? How much profit will each firm make? Does Asphalt have an incentive to cheat by paving one more driveway each month? Show it numerically.arrow_forwardBased on the information given, indicate whether the following industry is best characterized by the model of perfect competition, monopoly, monopolistic competition, or oligopoly.a. Industry A has a four-firm concentration ratio of 0.005 percent and a HerfindahlHirschman index of 75. A representative firm has a Lerner index of 0.45 and a Rothschild index of 0.34.b. Industry B has a four-firm concentration ratio of 0.0001 percent and HerfindahlHirschman index of 55. A representative firm has a Lerner index of 0.0034 and Rothschild index of 0.00023.c. Industry C has a four-firm concentration ratio of 100 percent and HerfindahlHirschman index of 10,000. A representative firm has a Lerner index of 0.4 and Rothschild index of 1.0.d. Industry D has a four-firm concentration ratio of 100 percent and HerfindahlHirschman index of 5,573. A representative firm has a Lerner index equal to 0.43 and Rothschild index of 0.76arrow_forward
- A common characteristic of oligopolies is a. interdependence in pricing decisions. b. independent pricing decisions. c. low industry concentration. d. few or no plant-level economies of scale.arrow_forwardIf there are two firms Atlas and Bowden in this market with the total cost function TC = 500 + 10Q^2 and they engage in Cournot competition, what is each firm's equilibrium quantity, price, and profit? [NB: round quantities to nearest integer to find equilibrium quantity, price, and profit]arrow_forwardA group of firms explicitly colluding to make price and output decisions is called a ) price leadership. b ) a cartel. c ) a concentrated industry. d ) an oligopoly.arrow_forward
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