If a market is shared equally by 100 firms, the Herfindahl-Hirschman Index is
A) 1/100.
B) 1/50.
C) 50.
D) 100.
D
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The technique currently used to calculate the CPI implicitly assumes that over time consumers buy
A) relatively more of goods whose relative prices are rising. B) relatively less of goods whose relative prices are rising. C) the same relative quantities of goods as in a base year. D) goods and services whose quality improves at the rate of growth of real income.
According to efficient market theory, which of the following can best predict the stock price of a particular company tomorrow?
A) a finance professor who knows a lot of investment theory B) a stock trader who has traded stocks for more than 10 years C) that company's employee who has inside information about the company D) none of the above: Everyone has an equal chance of predicting future stock prices
If a "liberal" wanted to decrease aggregate demand, which of the following would she tend to favor?
a. An increase in government spending, because it will increase the size of the public sector. b. A decrease in government spending, because it keeps the public sector small. c. An increase in transfer payments, because it has a larger multiplier than tax changes. d. An increase in taxes, because it makes the public sector larger.
A U.S. firm opens a factory that produces power tools in Korea
a. This increases U.S. net capital outflow and decreases Korean net capital outflow. b. This decreases U.S. net capital outflow and increases Korean net capital outflow. c. This increases only U.S. net capital outflow. d. This increases only Korean net capital outflow.