posted by janice on .
Suppose you have an industry with 20 firms and the concentration ratio is 20%. How would you describe this industry?
A concentration ratio of 20% means that the top n firms account for 20% of the market. What, is n?. If n=1, then the industry has one dominant firm. If n=4, then the industry is quite competitive. (n=5 implies all firms have equal shares).