The lower the concentration ratio, the
a. more control an individual firm has to set prices.
b. more competitive the industry.
c. less competitive the industry.
d. Both a and c are correct.
b
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A competitive employer will hire inputs up to the point where the
A. price of the input equals the marginal product of the input. B. price of the input equals the price of the output. C. price of the input equals the marginal revenue product of the input. D. marginal product of the input reaches a maximum.
Firms should begin their pricing decisions by:
a. assessing total marginal cost of the product b. identifying the value drivers in each customer segment c. researching the market price of competitors d. none of the above
Alice has spent all of her income on ten different goods, and knows that the marginal utilities per dollar spent on the ten goods are equal. Which of the following statements is correct?
a. She could possibly increase her total utility by redistributing her income among the ten items. b. She has violated the assumption of rationality. c. The law of diminishing marginal utility does not apply to her. d. Any reallocation of income among the ten items will reduce her total utility. e. She must be at a point inside of her budget line.
Explain how a bilateral monopoly equilibrium outcome differs from a purely competitive outcome