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1.5 Perfect competition, imperfectly competitive markets and monopoly

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Question 6

The following table shows the market shares of the five leading firms in a specific service market.

FirmMarket share (%)
Company Alpha25
Company Beta16
Company Gamma20
Company Delta12
Company Epsilon9
Others18

If Company Beta and Company Epsilon merge to form a single firm, what happens to the three-firm concentration ratio (CR3CR_3CR3​) and the five-firm concentration ratio (CR5CR_5CR5​)?

Falls / Falls

Falls / Rises

Rises / Falls

Rises / Rises

1.5 Perfect competition, imperfectly competitive markets and monopoly Questions

  1. A Level
  2. /Economics
  3. /1.5 Perfect competition, imperfectly competitive markets and monopoly