The four firm concentration ratio (C4) in the motor vehicle manufacturing market is 85%. The C4 in the electronic components market used in motor vehicles is 24%. From this we might infer that motor vehicle manufactures have less bargaining power than electronic component manufacturers. the price markups over marginal cost are higher in the electronic components market than the motor vehicle market. motor vehicle manufactures have the same bargaining power as electronic component manufacturers. motor vehicle manufactures have more bargaining power than electronic component manufacturers.

The four firm concentration ratio (C4) in the motor vehicle manufacturing market is 85%. The C4 in the electronic components market used in motor vehicles is 24%. From this we might infer that motor vehicle manufactures have less bargaining power than electronic component manufacturers. the price markups over marginal cost are higher in the electronic components market than the motor vehicle market. motor vehicle manufactures have the same bargaining power as electronic component manufacturers. motor vehicle manufactures have more bargaining power than electronic component manufacturers.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter16: Bargaining

Section: Chapter Questions

Problem 16.1IP

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