The Herfindahl Index Measures the

question 13

Multiple Choice

The Herfindahl index measures the

• A) size of the market share of the four largest firms in an industry.
• B) sum of the squared values of market shares of firms in an industry.
• C) increase in economic concentration resulting from a conglomerate merger.
• D) effect of per se violation in antitrust cases.

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Definitions:

No-Par

Refers to stock issued without a nominal or par value.

Paid-In Capital

Paid-in capital is the amount of money investors have given a company in exchange for shares of stock, representing capital provided by shareholders through the purchase of stock from the corporation.

Noncumulative

Describes dividends on preferred stock that, if not paid in the year they are due, do not accumulate and are not required to be paid in later years.

Par Value

A terminology indicating the official value of a security as outlined in the document at the time of its issue.