Needing questions 1 & 2 answered.

Assignment: Imagine that you are employed by the US. Department ofJustice and you are on the team that must determine the type of market structure for the tattoo industry. Table 1 shows the total revenue of the 50 firms in the tattoo industry. First, calculate the market share by dividing the total revenue of the firm (numerator) by the total industry revenue (denominator) for each firm. See the example for Tattoo Time. 1. The four-firm concentration ratio is 46.6. Calculate the HHI using the HHI formula. Based on Table 2, what is the market structure of the tattoo industry? (Perfect, monopoly, monopolistic, oligopoly) 2. What would the market structure of the tattoo industry be if each firm operated in a different city and the cities were spread across the nation (Hint: keep in mind there are only 50 firms in the industry) 3. What additional information would you need about the tattoo industry to be sure that it is an example of monopolistic competition? 4. Suppose that a new tattoo technology makes it easier for anyone to enter the tattoo market. How might the market structure change? 5. Based on your answer, why is it important to calculate the know the HHI as it relates to competition