Question

Exhibit 25-3

Firms	Market Share
A	7%
B	12%
C	3%
D	9%
E	10%
F	20%
G	6%
H	6%
I	14%
J	5%
K	5%
L	3%

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Refer to Exhibit 25-3. The four-firm concentration ratio for this industry is

	a.	46 percent.
	b.	49 percent.
	c.	56 percent.
	d.	44 percent.
	e.	This cannot be determined without further information.

Refer to Exhibit 25-3. The Herfindahl Index for this industry is currently

	a.	10,000.
	b.	840.
	c.	1,980.
	d.	1,330.
	e.	1,110.

Refer to Exhibit 25-3. The Justice Department would consider this industry to be

	a.	concentrated, because the top four firms together control more than 80 percent of the market share.
	b.	concentrated, because there are fewer than 100 firms in the industry.
	c.	unconcentrated, because there is more than 1 firm in the industry.
	d.	unconcentrated, because the Herfindahl index is less than 1,800.
	e.	unconcentrated, because the Herfindahl index is more than 1,800.

Answer 1