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UTILITY: The satisfaction of wants and needs obtained from the use or consumption of goods and services. The terms utility and satisfaction are, for the most part, used interchangeably in economics. Two other somewhat technical economic terms frequently used to capture this notion are welfare and well-being. Whichever term is used, the underlying concept is the same: To what extent are unlimited wants and needs fulfilled using the goods and services produced from society's limited resources.
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Lesson 20: Oligopoly | Unit 2: Structure
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Page: 7 of 24
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Topic:
Concentration Ratios
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- The most popular measure (or measures) of concentration has (have) been the concentration ratio.
- A quick definition:
- A concentration ratio is the proportion of total output in an industry that's produced by a given number of the largest firms in the industry.
- The two most common concentration ratios are the 4-firm concentration ratio and 8-firm concentration ratio.
- In general concentration ratios range for a low of 0% to a high of 100%.
- A ratio of 0% indicates perfect competition and 100% ratio indicates total market control by the given number of firms use for the calculation
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PERFECT COMPETITION, SHORT-RUN PRODUCTION ANALYSIS A perfectly competitive firm produces the profit-maximizing quantity of output that equates marginal revenue and marginal cost. This production level can be identified using total revenue and cost, marginal revenue and cost, or profit. Because a perfectly competitive firm faces a perfectly elastic demand curve, it efficiently allocates resources by equating price and marginal cost. In addition, the marginal cost curve above the average variable cost curve is the perfectly competitive firm's short-run supply curve.
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PURPLE SMARPHIN
[What's This?]
Today, you are likely to spend a great deal of time flipping through mail order catalogs wanting to buy either a birthday gift for your father that doesn't look like every other birthday gift for your father or a green fountain pen. Be on the lookout for vindictive digital clocks with revenge on their minds.
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This isn't me! What am I?
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A U.S. dime has 118 groves around its edge, one fewer than a U.S. quarter.
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"The greatest things ever done on Earth have been done little by little. " -- William Jennings Bryan
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ICSID
International Center for the Settlement of Investment Disputes
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