Which of the following four-firm concentration ratios would be the best indicator of an oligopoly?
A) 0.25 percent
B) 31 percent
C) 78 percent
D) 100 percent
E) 11 percent

Question

Quizplus · Accepted Answer

A four-firm concentration ratio measures the combined market share of the four largest firms in an industry. A ratio of 78 percent indicates that the industry is dominated by a few large firms, which is a characteristic of an oligopoly market structure. The other choices suggest that the industry is either perfectly competitive (0.25 percent) or monopolistic (100 percent) or has moderate competition (11 percent).

Which of the Following Four-Firm Concentration Ratios Would Be the Best