On a national level, the concentration ratio for grocery stores is very low. But, the "true" market for grocery stores is local in nature. What limitation does the geographic market put on the measure of concentration for grocery stores?
A) On the local level, grocery stores are more concentrated than they appear on the national level.
B) On the local level, grocery stores are not as concentrated as they appear on the national level.
C) The level of concentration is overestimated when viewing the national level.
D) Both answers A and C are correct.

Question

Quizplus · Accepted Answer

The geographic market limitation means that while nationally grocery stores may seem less concentrated, locally they can be more concentrated due to fewer competitors in a given area.

On a National Level, the Concentration Ratio for Grocery Stores