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Market power can be measured in various ways; explain. Looking at both performance and structure, what...

Market power can be measured in various ways; explain. Looking at both performance and structure, what would you conclude about which of industries A or B has greater market power?

Industry A

11 firms, with market shares 20%, 20%, 20%, 15%, 10%, 5%, 2%, 2%, 2%, 2%, 2%

P= $14, MC = $10, η = 1.5


Industry B

25 firms, with market shares 40%, 5%, 5%, 5%, 5%, 2%, …… 2% (20 firms each with 2%)

P = $12, MC = $10, η = 5

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