Asked by Olivia Wilma on Jun 01, 2024
Verified
A low concentration ratio means that
A) there is a low probability of entering the industry.
B) there is a low probability of success in the industry.
C) each firm accounts for a small market share of the industry.
D) each firm accounts for a large market share of the industry.
Concentration Ratio
A measure used in economics to assess the degree of market concentration by summing the market shares of the top firms in the industry.
Market Share
The proportion of total sales or business that a company or product secures within a particular market.
Industry
A sector of the economy characterized by the production or processing of similar goods or services.
- Recognize the significance of concentration ratios in understanding market structure and competition levels.
Verified Answer
JL
Jailene LaureanoJun 01, 2024
Final Answer :
C
Explanation :
A low concentration ratio indicates that the market share is spread out more evenly among firms in the industry, meaning each firm accounts for a smaller portion of the total market.
Learning Objectives
- Recognize the significance of concentration ratios in understanding market structure and competition levels.
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