I need help with my assignment. You want to start a company, and are trying to decide between two different industries. You are doing your final research before you write your business plan.
Industry A has 20 firms and a Concentration Ratio (CR) of 30%
What is the name for this type of industry?
Describe some of this industry's characteristics.
If you were in this industry and there was an increased demand for the product that pushed up the price of goods, what long-run adjustments would you expect?
What does your anticipated adjustment process imply about the CR for the industry?
Industry B has 20 firms and a Concentration Ratio (CR) of 80%.
What is the name for this type of industry?
Describe some of this industry's characteristics.
What are some reasons why this industry has a high CR while Industry A had a low CR?
Is it possible for smaller firms to thrive and profit in Industry B? Why or why not?
Industry A 20 firms with concentration ratio of 30% is monopolistic competitive.
Industry B 20 firms with concentration of 80% is an oligopoly.
I need help with this you are start a company and are trying to decide between two diffrent industries. You are doing your final research before youw write your business plan
INDUSTRY A HAS 20 FIRMS AND A CONCENTRATION RATIO (CR) OF 30%
1.WHAT IS THE NAME FOR THIS TYPE OF INDUSTRY?
2.DESCRIBE SOME OF THE INDUSTRYS CHARACTERISTICS.
3.IF YOU WERE IN THIS IDUSTRY AND THERE WAS ON INCREASED DEMAND FOR THE PRODUVT THAT PUSHED UP THE PRICE OF GOOD. WHAT LONG-RUN ADJUSTMENT WOULD YOU EXPECT
4.WHAT DOES YOUR ANTICIPATED ADJUCTMENT PROCESS IMPLY ABOUT THE CR FOR THE INDUSTRY?
5. WHATTHE NAME FOR THETYPE OF INDUSTRY/?
6.SESCRIBE SOME OF THE INDUSTRY'S CHARATERISTICS?
7.0WHAT ARE SOME REASONS WHY THE INDUSTRY HAS A HIGH CR WHILE INDUSTRY A HAD A LOW CR
7.IS IT POSSIBLE FOR SMALLER FIRMS TO THRIVE AND PROFITS IN INDUSTRY B? WHT OR WHY NOT
The name for an industry with a Concentration Ratio (CR) of 30% is "moderately concentrated industry."
Characteristics of this type of industry include a moderate level of competition, where a few large firms dominate the market, but there is still room for smaller firms to exist. The industry may have barriers to entry that make it difficult for new firms to enter and compete effectively. The market share of the largest firms would be less than the market share of the smaller firms combined.
In this industry, if there is an increased demand for the product that pushes up the price of goods, we would expect the existing firms to experience higher profits. As a result, there may be incentives for new firms to enter the market or existing firms to expand their operations. This would lead to an increase in the number of firms in the long run.
The anticipated adjustment process implies that the CR for the industry will decrease over time. As more firms enter or expand their operations in response to the increased demand and higher prices, the market share of the largest firms will decrease, leading to a lower concentration ratio.
The name for an industry with a Concentration Ratio (CR) of 80% is a "highly concentrated industry."
Characteristics of this type of industry include a high level of concentration, where a few large firms dominate the market and have significant market power. The industry may have significant barriers to entry, making it difficult for new firms to enter and compete effectively. The market share of the largest firms would be substantially higher than the market share of the smaller firms combined.
There can be several reasons why this industry has a high concentration ratio compared to Industry A with a low concentration ratio. Some reasons could include economies of scale, where larger firms have cost advantages that smaller firms cannot match. Additionally, there might be significant barriers to entry, such as high startup costs, government regulations, or proprietary technology, that deter new entrants. In some cases, mergers and acquisitions among existing firms could also contribute to a higher concentration ratio.
In Industry B, smaller firms may find it challenging to thrive and profit. The highly concentrated nature of the industry, combined with the market power of the dominant firms, can make it difficult for smaller players to compete effectively. Larger firms may have better access to resources, distribution channels, and economies of scale, putting smaller firms at a disadvantage. Additionally, the dominant firms might engage in aggressive pricing strategies or other anti-competitive practices that make it difficult for smaller firms to gain market share or achieve profitability. However, it is still possible for smaller firms to succeed if they can find niche markets or differentiate themselves in some way that provides a competitive advantage.