inal answer:
Market share is the percentage of total sales a company or product holds in its market, best defined as a retailer's total sales divided by the entire market's sales. The definition of the market can alter the perceived market share significantly, with broader definitions often showing a smaller concentration.
Step-by-step explanation:
Market share refers to the percentage of total sales in the market that a particular company or product commands. From the provided options, the most accurate definition of market share is number 2, which specifies that it is a retailer's total sales divided by total market sales. This enables a business to gauge its relative size within its industry or market segment.
Moreover, defining a market can significantly influence the perceived concentration of market share. For instance, Microsoft's dominance appeared different when considering only the software for computer operating systems versus the broader market of all software and services. Measurement tools like the four-firm concentration ratio, which sums the market shares of the four largest firms, and the Herfindahl-Hirschman Index (HHI), which calculates a weighted sum of all firms' market shares squared, can gauge the level of competition within a market.