Industries X and Y both have four-firm concentration ratios of 16 percent, but the Herfindahl index for X is 102, while that for Y is 95. These data suggest

A) greater market power in Y than in X.
B) greater market power in X than in Y.
C) both industries are strongly oligopolistic.
D) that price competition is stronger in X than in Y.

Herfindahl Index

A method for evaluating market concentration by squaring individual firms' market shares and then aggregating these squared figures.

Concentration Ratios

Measures that indicate the extent of market control by the largest firms in an industry, reflecting the level of competition.

Market Power

Describes the ability of a company or group to manipulate or control prices within a market, often by influencing supply, demand, or both.