If an industry is dominated by three large producers whose ...

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If an industry is dominated by three large producers whose revenues represent 30, 30, and 30 of the market's total revenues with the remaining two firms each representing 5, what would be the four firm concentration ratio and the Herfindahl-Hirschman Index for this industry?
 a. 95; 2,725
  b. 95; 2,750
  c. 70; 9,975
  d. 70 10,000

Question 2

Assume that a single insurance plan covers 2,000 low-risk people and 1,000 high-risk ones, all of whom pay the same premium, at which the insurer breaks even. If the average claim submitted by low-risk people is 100 while that submitted by high-risk people was 1,000 . what would be the net benefit to a low-risk person from holding a policy?
 a. -300
  b. -250
  c. 100
  d. 500

[BUTTHOL369]

Answer to Question 1

b

Answer to Question 2

A