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Description of an industry with 20 firms and the CR is 20.

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Suppose you have an industry with 20 firms and the CR is 20. How would you describe this industry? Suppose the demand for the product rises and pushes up the price for the good. What long-run adjustments would you expect following this change in demand? What does your adjustment process imply about the CR for the industry?

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Changes in an industry and its concentration ratio

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The four-firm concentration ratio, or CR, represents the market share, as a percentage, of the four largest firms in the industry. A CR of less than 40% represents monopolistic competition. Thus, ...

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