A Herfindahl-Hirschman Index Is Calculated by

question 161

Multiple Choice

A Herfindahl-Hirschman Index is calculated by

• A)summing the amount of sales by the four largest firms and dividing by total industry sales.
• B)dividing the number of firms wanting to merge by the total number in the industry.
• C)summing the squares of the market shares of each firm in the industry.
• D)dividing the advertising expenditures of the firms that want to merge by total industry advertising expenditures.

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Definitions:

CPI-Measured Inflation Hedge

An investment or asset that is expected to increase in value at a rate that matches or exceeds the rate of inflation as measured by the Consumer Price Index (CPI), thus preserving purchasing power.

TIPS

Treasury Inflation-Protected Securities, a type of U.S. Treasury bond designed to help investors protect against inflation.

Fully-Funded Pension Funds

Pension plans that have sufficient assets to meet all the pension obligations to participants, both present and anticipated.

Inflation Hedge

An investment that is considered to protect against the decrease in purchasing power due to inflation.