The top four firms in industry A have market shares of 30, 25, 10, and 5 percent, respectively

Marketing Jan 13, 2021

The top four firms in industry A have market shares of 30, 25, 10, and 5 percent, respectively. The top four firms in industry B have market shares of 15, 12, 8, and 4 percent, respectively. Calculate the four-firm concentration ratios for the two industries. Which industry is more concentrated?

Expert Solution

Concentration Ratio in industry A = 30% + 25% + 10% + 5% = 70%
Concentration Ratio in industry B = 15% + 12% + 8% + 4% = 39%

Industry A is more concentrated.

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