Consider an industry that is made up of nine firms each with a market share (percent of sales) as follows:
a. Firm A: 30%
b. Firm B: 20%
c. Firms C, D, and E: 10% each
d. Firms F, G, H, and J: 5% each
What is the value of the Herfindahl-Hirschman Index?
A) 1,425
B) 1,600
C) 1,700
D) 2,600
Answer: C
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_________ is the Japanese word meaning death from over work
a. Karoshi b. Tora c. Samauri d. Santori
Financial Innovation More and more of the back office tasks for commodity traders and market makers can be easily automated which lowers the costs of making transactions. What is the effect of these technical changes on the bid-ask spreads between commodity buyers and sellers at commodity exchanges?
Conglomerate integration:
A. improves cash flow by exploiting the cyclical nature of different product lines. B. exploits economies of scope by merging the production of similar products. C. reduces the transaction costs of acquiring inputs. D. All of the statements are correct.
Which of the following is a barrier to entry?
A. Patents and licenses B. Buyers' incomes C. Close substitutes D. Diminishing marginal returns