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What is the four firm concentration ratio for the

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Unformatted text preview: or the steel industry? a) b) c) d) e) 35 percent 65 percent 20 percent 38 percent 40 percent Solution: b) 65 percent Total industry sales =200 + 180 + 150 + 120 + 350 =1000 Sales of the four largest firms = 200 + 180 + 150 + 120 = 650 The four-firm concentration ratio= (sales of the four largest firms / total sales)*100% = (650 / 1000)*100%=65% Use the following table to answer question 28: Method A B C Quantity of Labour 10 15 20 Quantity of Capital 15 12 10 Q28. Which of the threes methods of production is (are) technologically efficient? a) b) c) d) e) Method A Method B Methods B and C Methods A and B Methods A, B, and C Solution: e) Methods A, B, C Method A uses more capital than methods B and C, but it uses the least amount of labour. Method C uses more labour than methods A and B, but it uses the least amount of capital. Page 17 of 33 ©Prep101 www.prep101.com/freestuff Method B uses more (less) labour than method A (method C), but it uses less (more) capital than method A (method C). Technologically efficient method produces a given out...
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