Suppose two industries had the same four-firm concentration ratio, but one industry was an unbalanced oligopoly and the other was balanced. The market share of the fourth largest firm in the unbalanced oligopoly will be
A) smaller or larger than the market share of the first largest firm in the unbalanced oligopoly
B) smaller than the market share of the fourth largest firm in the balanced oligopoly
C) larger than the market share of the first largest firm in the balanced oligopoly
D) more than 20 percent
E) the same as the fourth largest firm in the balanced oligopoly

Question

Quizplus · Accepted Answer

In an unbalanced oligopoly, the market shares are unevenly distributed, so the fourth largest firm will have a smaller share compared to a balanced oligopoly where shares are more evenly distributed.

Suppose Two Industries Had the Same Four-Firm Concentration Ratio, but One