Suppose that there are only three types of fruit sold in the United States. Annu

Question

Suppose that there are only three types of fruit sold in the United States. Annual sales are 1, 200,000 tons of blueberries. 5, 400,000 tons of strawberries, and 12,000,000 tons of bananas. Suppose that of those total amounts, the Sunny Valley Fruit Company sells 1, 100,000 tons of blueberries. 900,000 tons of strawberries, and 9, 200,000 tons of bananas. Instructions: Round your answers to the nearest whole number. What is Sunny Valley's market share if the relevant market is blueberries? percent. If a court applies the "90-60-30 rule" when considering just the blueberry market, would it rule that Sunny Valley is a monopoly? market share if the relevant market is all types of berries? Would the court rule Sunny Valley to be a monopolist in that market? What if the relevant market is all types of fruit? What is Sunny Valley's market share? percent. Would the court consider Sunny Valley to be a monopolist?

Explanation / Answer

a) Sunny Valley's market share is 90 % if the relevant market is blueberries. If court applies the '90-60-30 rule when considering just the blueberry market, it would rule the Sunny Valley's monopoly. This is the clear case of the monopoly of Sunny Valley.

b) Sunny Valley's market share is 30 % if the relevant market is all kinds of berries. If court applies the '90-60-30 rule when considering just the blueberry market, it would not rule the Sunny Valley's monopoly. This is not the case of monopoly of Sunny Valley.

c) Sunny valley's market share, if the relevant market is all types of fruits:-

= 1100000 + 900000 + 9200000 / 1200000 + 5400000 + 12000000

= 11200000 / 18600000

= 60.22 % (approx)

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