13. Explain how changes in the demand for a final product will impact intermediary (input) markets. Graphically illustrate the impact.

14. What is meant by derived demand for a product? Section B: Calculations

1. Concentration ratio: The candy manufacturing industry in Fiji has about $100 million per year in sales. In all, there are 40 companies in the industry. The annual sales of the top four companies in the market are: Company 1: $25 million Company 2: $15 million Company 3: $10 million Company 4: $5 million

a) Calculate the percentage of the total candy market held by each of the top four companies, and the percentage of the market held by the four companies together.

b) Based on this information, how would you categorize the type of market structure for Fiji's candy industry? (Monopoly, Oligopoly, Monopolistic Competition, Perfect Competition)

2. Lerner Index: In the Fiji candy industry, the average price for a candy bar is the equivalent of US $1.00. It is estimated by industry experts that the marginal cost of producing a candy bar is $.80. Calculate the Lerner Index for Fiji candy bar producers