Accounting

(a) Use the estimated elasticities to calculate the Rothschild index for each industry.

Instruction: Round your answers to 3 decimal places.

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Industry Own Price Elasticity of Market Demand Own Price Elasticity of Demand for Representative Firm’s Product Rothschild index
Agriculture -1.8 -96.2 [removed]
Construction -1.0 -5.2 [removed]
Durable manufacturing -1.4 -3.5 [removed]
Nondurable manufacturing -1.3 -3.4 [removed]
Transportation -1.0 -1.9 [removed]
Communication and utilities -1.2 -1.8 [removed]
Wholesale trade -1.5 -1.6 [removed]
Retail trade -1.2 -1.8 [removed]
Finance -0.1 -5.5 [removed]
Services -1.2 -26.4 [removed]

(b) Based on these calculations, which industry most closely resembles perfect competition?

Transportation.

Wholesale trade.

Finance.

Retail trade.

(c) Which industry most closely resembles monopoly?

Wholesale trade.

Retail trade.

Finance.

Transportation.

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