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# Question 11 A student has calculated the HHI of 7,681 for an industry. From this result we can conclude that: this industry is highly concentrated.

Question 11
A student has calculated the HHI of 7,681 for an industry. From this result we can conclude that:

a. this industry is highly concentrated.

b. this industry is not very concentrated.

c. entry into and exit from the industry is very difficult.

d. this student has made a computational error.

e. None of the above.

Question 12
The HHI published by the U.S. Census Bureau is superior to concentration ratios because:

a. it includes the output of foreign producers.

b. it is calculated regionally.

c. it uses data from all firms in the domestic industry.

d. All of the above.

e. None of the above.

Question 13
1. A firm’s marginal cost is \$25. If it charges a product is \$50, the Lerner Index for this firm is:

a. 0.25.

b. 0.50.

c. 0.75.

d. 1.00.

e. None of the above.

Question 14
A decrease in price will:

a. raise the Lerner Index.

b. lower the Lerner Index.

c. lower the Hirfindahl-Hirschman Index.

d. raise the 8-firm concentration ratio.

e. None of the above.

Question 15
If the price elasticity of demand –2.5, the Lerner Index is:

a. 0.25.

b. 0.4.

c. 0.6.

d. 0.85.

e. None of the above.

Question 16
A firm’s Lerner Index is 0.6. If it charges a price of \$12, marginal cost is:

a. \$4.80.

b. \$5.20.

c. \$15.

d. \$16.75.

e. None of the above.

Question 11
A student has calculated the HHI of 7,681 for an industry. From this result we can conclude that:
a. this industry is highly concentrated.
b. this industry is not very concentrated.
c....

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