The cola industry in the country of Inner Baldonia consists of five sellers: two global brands, Coke and Pepsi, and three local competitors, Bright, Quite, and Zight. Consumers view these products as similar, but not identical. The market shares of the five sellers are as follows:
Firm Market share
Coca Cola ........................... 25%
Zight ................................. 24%
Pepsi ................................. 23%
Bright ................................ 20%
Quite ................................. 8%
a. What is the four-firm (4CR) concentration ratio for this industry?
b. What is the Herfindahl-Hirschman Index (HHI) for this industry?
c. Of the market structures described in Table 13.1, which one best describes the cola industry in Inner Baldonia?