Suppose the larger firm of a duopoly has sales of $400 million and the smaller firm has sales of $100 million.The market share of the larger firm is

Question

Quizplus · Accepted Answer

Market share is calculated by dividing a firm's sales by the total market sales. In this case, the total market sales are $500 million ($400 million + $100 million).

The market share of the larger firm is its sales ($400 million) divided by the total market sales ($500 million), which equals 0.8 or 80%. Therefore, the best choice is A).

Suppose the Larger Firm of a Duopoly Has Sales of $400