Which of the Following Is Most Likely to Increase the Herfindahl

question 22

Multiple Choice

Which of the following is most likely to increase the Herfindahl index of a particular industry?

• A) A horizontal merger between two of the industry's largest firms.
• B) A vertical merger between one of an industry's largest firms and one of the many input suppliers in the resource market.
• C) A conglomerate merger involving one of the industry's major firms.
• D) An agreement by all the industry firms to divide up the market among them.

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Definitions:

Labour Costs

The total sum of all compensation that a business must pay to its employees for a set period or on a given project.

Environmental Pollution

The contamination of the natural environment causing adverse effects on living beings and the ecosystem.

Incorporation Practices

Incorporation practices involve legal and procedural steps required to form and register a company as a separate legal entity, according to specific jurisdictional regulations.

Business Ownership

refers to the possession and control over a business enterprise, including the rights to make decisions and reap the benefits or losses.