To measure market concentration, the _____ is generally easier to calculate, and the _____ is generally more precise.

Question

Quizplus · Accepted Answer

The concentration ratio is generally easier to calculate because it simply adds up the market shares of the top firms in the market. The Herfindahl-Hirschman Index (HHI) is more precise as it takes into account the distribution of market share across all firms by squaring each firm's market share and then summing these squares.

To Measure Market Concentration, the _____ Is Generally Easier to Calculate