What would the Herfindahl-Hirschman Index equal for an industry consisting of six firms with market shares of 40%, 30%, 20%, 5%, 3%, and 2%?
a. 0.95
b. 2.934
c. 2,938
d. 10,000
c
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Refer to Scenario 17.1. The lowest level of y* that can be set and still have only the high-productivity people meet it is
A) 16. B) 13 1/3. C) 13. D) 8. E) 0.
Tacit collusion is
a. collusion which is carried out without any explicit agreement among firms. b. collusion about tacits, rather than strategy. c. agreements which are sponsored by government. d. similar to pure competition.
Consider the market for capital equipment. Suppose the value of the marginal product of capital equipment increases. Holding all else constant, the equilibrium quantity of capital equipment will
a. increase. b. decrease. c. not change. d. It is not possible to determine what will happen to the equilibrium quantity of capital equipment.
Some politicians rally against using the market to reduce pollution because
A. pollution charges and tradable permits allow firms to pollute as long as they can pay for it. B. polluting firms do not care about the environment, so something must be done. C. government-run industries have been better at controlling their pollution costs when compared to privately run firms D. pollution charges and tradable permits do not penalize polluting firms.