The Use of the Herfindahl-Hirschman Index (HHI) to Measure Market

question 108

True/False

The use of the Herfindahl-Hirschman Index (HHI) to measure market concentration is encouraged for banks because of the ease of separating banks from thrifts and insurance companies.

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Definitions:

Respondeat Superior

A legal doctrine holding an employer or principal liable for the actions of an employee or agent performed within the course of their employment or agency.

Apparent Agency

A legal doctrine allowing a principal to be held liable for the actions of an agent, based on the appearance of authority given to the agent by the principal.

Principal's Actions

Refers to the deeds or activities undertaken by the principal figure in a contractual or agency relationship, affecting the relationship's legal standing.

Negotiable Instrument

A written document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payer named on the document.