If an industry has 4 firms, with the largest firm being twice as large as any other one (the 3 remaining firms are equal in size), the 4-firm concentration ratio of this industry would be
A. 0.4
B. 1
C. 0.5
D. not enough information is provided
Ans: B. 1
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The following is an example of adverse selection
a. A majority of those applying for well paid jobs are well qualified b. More reckless drivers opt for cars with fewer safety devices c. Individuals living in less secure neighborhoods want to buy less insurance d. Individuals with a strong family history of heart diseases opt to buy more insurance
The measures of absolute poverty:
a. are inversely related to the degree of income equality in a country. b. are directly related to the degree of income equality in a country. c. depend on the prosperity of the poorest 50 percent of population. d. determine the degree of income inequality. e. are completely independent of the degree of income inequality.
Government regulation of _______________ protects customers from high prices in situations where there is no competition that would ordinarily keep prices down.
a. natural monopolies b. monopolistic competition c. perfect competition d. luxury markets
Which of the following policies is a positive supply-side lever?
A. Lowering the minimum reserve requirement. B. Open market operations. C. Income transfers. D. Human capital investment.