Suppose that Firm ABC currently has a market share of 8 percent. Firm XYZ has a market share of 12 percent. What will happen to the Herfindahl-Hirschman index if the two firms merge? Show your work
What will be an ideal response?
The index will rise by (202) - (82) - (122) = 400 - 64 - 144 = 192 points.
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If a monopoly firm sells to competitive distributors and the distributors have a constant marginal cost of $4 and they are charging the profit-maximizing retail price of $12, what is wholesale price of the product?
A) $16 B) $4 C) $8 D) $12
In a competitive labor market, if the demand for labor decreases, labor demand will shift to the:
A. right and wages will increase. B. left and wages will increase. C. right and wages will decrease. D. left and wages will decrease.
Aggregate expenditure (AE) equals
a. C + I + G. b. C + G. c. C – I – (X – IM). d. C + I + G + (X – IM).
The share of the burden of an emissions tax on output borne by the consumer of the polluting output will rise as
A. the tax rises. B. demand elasticity falls. C. demand elasticity rises. D. the tax falls.