If an industry is made up of five identical-sized firms, the four-firm concentration ratio is

Question

Quizplus · Accepted Answer

The four-firm concentration ratio measures the market share held by the top four firms in an industry. In this case, since there are five identical-sized firms, each firm has a market share of 20%. Therefore, the combined market share of the top four firms is 80% (20% x 4), making the four-firm concentration ratio 80%.

If an Industry Is Made Up of Five Identical-Sized Firms