Question

Which of the following statements best describes market share?a) It is the sum of the sales revenues of the different products of a firm across their respective markets.b) It is the difference between a firm's total cost and total revenue.c) It is the ratio of a firm's profits to the total cost of production.d) It is the sum of the total cost of production and the sales revenue of all the products of a firm.e) It is the ratio of a firm's sales revenues or unit sales to those of the industry.

Answer 1

Answer:

e) It is the ratio of a firm's sales revenues or unit sales to those of the industry.

Explanation:

Market share is the term used to describe the share in total sales of the market for the particular product produced by the organization in concern.

Individual firm's market share = $\frac{Sales revenue of firm}{Total sales of the product in the market}$

This, clearly relates to statement (e) in the option as that statement includes the ratio of firm's sales to the sales in the market.

Therefore, correct option is

Statement e)