In the 1990s, the infant/preschool toy market four-firm concentration ratio was 72 percent. With 8 percent of the market, Mattel was the fourth-largest firm in that market.

Mattel proposed to buy Fisher-Price, the market leader with 27 percent.

a. Why would Mattel want to buy Fisher-Price?

b. What arguments can you think of in favor of allowing this acquisition?

c. What arguments can you think of against allowing this acquisition?

d. How do you think the four-firm concentration ratio for the entire toy industry would compare to this infant/

preschool toy market concentration ratio?