Industries X and Y both have four-firm concentration ratios of 70 percent, but the Herfindahl index for X is 2,500, while that for Y is 2,000. These data suggest
A) greater market power in Y than in X.
B) greater market power in X than in Y.
C) that X is more technologically progressive than Y.
D) that price competition is stronger in X than in Y.
Correct Answer:
Verified
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A)may overstate the degree of competition
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