The four largest firms in an industry account for the following ...

[awywial]

The four largest firms in an industry account for the following value of industry sales: 12 percent, 8 percent, 5 percent and 4 percent. Calculate the four-firm concentration ratio. Would this industry be regarded as competitive or concentrated?
 
  What will be an ideal response?

Question 2

If a lender checks credit reports on individuals before mailing out loan offers, it is most likely trying to avoid
 
  A) moral hazard.
  B) moral dilemma.
  C) adverse selection.
  D) adverse reaction.

[rnehls]

Answer to Question 1

The four-firm concentration ratio is 29 percent. The four-firm concentration ratio is less than 40 percent, so the industry would be regarded as competitive.

Answer to Question 2

C