Suppose the market for good X has a four-firm concentration ratio of 0.50.Furthermore,assume that total sales in the industry are $1.2 million.Based on this information,we know that sales for the largest four firms in the industry equal (in aggregate):

Question

Quizplus · Accepted Answer

The four-firm concentration ratio is the percentage of total industry sales accounted for by the four largest firms. A concentration ratio of 0.50 means that the four largest firms account for 50% of total industry sales. Therefore, the sales for the largest four firms in the industry would be $600,000 (50% of $1.2 million).

Suppose the Market for Good X Has a Four-Firm Concentration