Microeconomics 6th Edition by Robert Hall, Shirley Kuiper, Marc Lieberman

Exercise 14

Starting with the data in problem 1,suppose that Firm A manages to take 5 percentage points of market share away from Firm C.
a. What is the 4-firm concentration ratio now?
b. What is the 8-firm concentration ratio now?
c. What is the HHI now?
d. Comparing your answers with those in problem 1,which measures have changed,and which have remained the same?
Problem 1
Suppose there are five firms in a market,with the following market shares:
Firm A: 30%
Firm B: 25%
Firm C: 20%
Firm D: 15%
Firm E: 10%
a. What is the 4-firm concentration ratio?
b. What is the 8-firm concentration ratio?
c. What is the HHI?