The percentage of total industry output accounted for by the largest firms in the industry is the:
A) concentration ratio.
B) employment rate.
C) sales index.
D) market number.

Question

Quizplus · Accepted Answer

The concentration ratio measures the market power of the largest firms in the industry by measuring the percentage of total industry output they produce. The higher the concentration ratio, the more market power these firms are likely to have. Therefore, the percentage of total industry output accounted for by the largest firms in the industry is the concentration ratio.

The Percentage of Total Industry Output Accounted for by the Largest