Consider an Industry That Is Made Up of Nine Firms

question 34

Multiple Choice

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

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Definitions:

Interest Rate

The fraction of a loan incurred as interest cost to the borrower, often expressed annually as a percentage of the total loan amount still due.

Interest Rate

The cost of borrowing money or the reward for saving, usually expressed as a percentage of the principal amount per annum.

Years From Now

This term projects a future timeline or point in time from the present moment.

Interest Rate

The amount charged on top of the principal by lenders to borrowers, usually expressed as an annual percentage of the loan.