The share of industry output sold by the top four steel producers in the country are 19%, 15%, 12%, and 9% respectively.The four-firm concentration ratio for the steel industry is
A)0.19.
B)0.55
C)0.138
D)0.65

Question

The share of industry output sold by the top four steel producers in the country are 19%, 15%, 12%, and 9% respectively.The four-firm concentration ratio for the steel industry is
A)0.19.
B)0.55 
C)0.138 
D)0.65

Quizplus · Accepted Answer

The four-firm concentration ratio is the sum of the market share percentages of the four largest firms in the industry. Therefore, the four-firm concentration ratio for the steel industry is 19% + 15% + 12% + 9% = 55%, which is option B.

The Share of Industry Output Sold by the Top Four