Chapter 14 Oligopoly Assignment (Protected View) - Word ences Mailings Review View Help Tell me what you want to do contain viruses. Unless you need to edit, it's safer to stay in Protected View. 2. The market shares of firms in three different industries are listed in the table below. Use this information to calculate the Herfindahl index for each industry.\ table[[Firms, Industry, 1 Industry, 2Industry 3], [1, 65, 70, 35], [2, 15, 15, 35], [3, 10, 10, 30], [4, 5, 5, -], [5, 5, -, -], [Herfindahl,,,], [ Index,,,]] (a) Which industry is has the greatest market power? The least? (b) Based on your findings, is the number of firms in the industry a good predictor of the competitiveness of an industry? Why or why not?
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- ACTIVITY 3 1. You were given the following capital balances of the partners of thePinnacle Trading: Pablo Php 10,000.00 Norman Php 20,000.00 Christian Php 30,000.00 The partners agreed to divide profit or loss in the ratio of their capital balances. If the partnership earned a profit of Php 30,000.00 for the year, compute the share of Pablo, Norman, and Christian to the profit of the business. a. Share of Profit for Pablo = Php b. Share of Profit for Norman = Php c. Share of Profit for Christian = Php %3DThe table below shows market share data for different firms producing desks. Market Share in % 15 18 7 11 6 10 4 5 5 16 Firm Aardvark Inc Baluga, LLC Cran Inc Delta Co Echo Co Farriss Co Gum Drop Inc Hill Corp Indigo Corp Jackson Co What is the Herfindahl Hirschman Index (HHI) for this market? ← HHI 225 324 49 121 36 100 16 25 25 256 Suppose that Delta Co and Gum Drop Inc are considering a merger. What will the HHI be after this merger?10:43 A docs.google.com Your answer Syukri, Iqmal and Amir run the only shop in Wang Ulu. They sell electrical goods such as televisions, washing machines, etc. However, their objectives are different from each other. Syukri wants to make as much profit as he can, Iqmal wants to sell as many goods as he can without losing money, and Amir wants to earn as much revenue as he can. The graph below illustrates their respective profits. (Note: The length of each square on the Y-axis represents RM100, and the length of each square on the X-axis represents 100 units.) What is the quantity for Syukri? Revenue, Cost MC AC Quantity 100 200 300
- Suppose that a small town has seven burger shops whose respective shares of the local hamburger market are (as percentages of all hamburgers sold): 23 percent, 22 percent, 18 percent, 12 percent, 11 percent, 8 percent, and 6 percent. Instructions: Enter your answers as a whole number. a. What is the four-firm concentration ratio of the hamburger industry in this town? Book percent Print b. What is the Herfindahl index for the hamburger industry in this town? erences c. If the top three sellers combine to form a single firm, what would happen to the four-firm concentration ratio and to the Herfindahl index? Four-firm concentration ratio = |percent Herfindahl index =1. Exercise 16.2 An industry is composed of Firm 1, which controls 50 percent of the market, Firm 2 with 30 percent of the market, and Firm 3 with 10 percent of the market. About 20 firms of approximately equal size divide the remaining 10 percent of the market. What is the Herfindahl-Hirschman Index for the industry? (Hint: Assume the 20 firms that make up 10 percent of the market constitute one firm.)What will the Herfindahl-Hirschman Index be if Firm 2 and Firm 3 merge? (Hint: Assume that the combined market share after the merger is 40 percent) Based on the HHI scores, will the government consider the merger of Firm 2 with Firm 3 to be procompetitive or anticompetitive? Anticompetitive Procompetiti1. There are 10 firms in an industry, and each firm has a market share of 10 percent. The industry’s Herfindahl index is a. 10. b. 100. c. 1,000. d. 10,000. 2. In the small town of Geneva, there are five firms that make watches. The firms’ respective output levels are 30 watches per year, 20 watches per year, 20 watches per year, 20 watches per year, and 10 watches per year. The four-firm concentration ratio for the town’s watch-making industry is: a. 5. c. 90. b. 70. d. 100. 3. Which of the following best describes the efficiency of monopolistically competitive firms? a. Allocatively efficient but productively inefficient. b. Allocatively inefficient but productively efficient. c. Both allocatively efficient and productively efficient. d. Neither allocatively efficient nor productively efficient.
- Carrot Computers and its competitors purchase touch screens for their tablet computers from several suppliers. The slx makers of touch screens have market shares of, respectively, 19 percent, 18 percent, 12 percent, 18 percent, 21 percent, and 12 percent. Instructions: Enter your answers as a whole number. a. What is the Herfindahl index for the touch screen manufacturing industry? ok b. By how much would a proposed merger between the two smallest touch screen makers increase the Herfindahl index? rint Is the government likely to challenge that proposed merger? brences (Click to select) : c. If Carrot Computers horizontally merges with its competitor Blueberry Handhelds, by how much would the Herfindahl index change for the touch screen industry?35. Use Table 11.5 to calculate the four-firm concentration ratio for the U.S. auto market. Does this indicate a concentrated market or not? GM 19% Ford 17% Toyota 14% Chrysler 11% Table 11.5 Global Auto Manufacturers with Top Four U.S. Market Share, June 2013 (Source: http://www.zacks.com/commentary/27690/auto- industry-stock-outlook-june-2013)ok In the table below are data on five different industries and the market shares for each of the firms in the industry. Assume that there is no foreign competition, entry into the industry is difficult, and that no firm in each industry is on the verge of bankruptcy. In the column to the right of the table, calculate the Herfindahl index. Tint erences esc Market Share of Firms in Industry Industry Alpha Beta Mc Graw Hill Q Short Answer Toolbar navigation Kappa Delta Epsilon BIVS -50--- Di 2 Which industry has the most market power and which industry has the least? P @ W # 3 E 4 Herfindahl index R 1 33 25 20 60 25 5 STAZA % 23 456 22 14 12 10 9 25 25 15 10 20 20 20 20 10 10 10 10 20 15 15 15 10 & Search Protecto Pray T 6 Y 1.5 7 2 Next > 8 1 O O * P |{ d
- The following table lists the market shares of the eight firms in an industry. Market Shares for Eight Firms in an Industry Firm Market Share 1 4040 2 2525 3 1515 4 1010 5 55 6 33 7 11 8 11 Calculate the Herfindahl-Hirschman Index (HHI) for this industry. Enter your answer in the box below, and round to the nearest whole number if necessary.oligopoli 5.1 The following table represents the market share percent- age for each firm in a hypothetical industry. Firm Market Share A 15 C D E 20 B 6 12 7 H 19 11 F G 10 a. Calculate the four-firm concentration ratio for this industry. b. Calculate the Herfindahl-Hirschman Index (HHI) for this industry. c. Would the Justice Department consider this industry as unconcentrated, moderately concentrated, or concen- trated? Why?Consider two industries, each comprising ten firms. In industry A, the largest firm has a market share of 49 percent. The next three firms have market shares of 7 percent each, and the remaining six firms have equal shares of 5 percent each. In industry B, the top four firms share the bulk of the market with 19 percent apiece. The next largest firm accounts for 14 percent, and the smallest five firms equally split the remaining 10 percent of the industry. a. Compute the four-firm concentration ratio and HI for each industry. Compare these measures across the two industries. Which industry do you think truly exhibits a more competitive structure? Which measure do you think gives a better indication of this? Explain. b. Now let the three second largest firms in industry A merge their operations while holding onto their combined 21 percent market share. Recalculate the HI for industry A. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care…