21-155 If Bank C Splits into Two Separate Institutions at ½

question 38

Multiple Choice

21-155 If Bank C splits into two separate institutions at ½ its original size each,what is the new Herfindahl (HHI) Index?

• A)60.
• B)340.
• C)2,538.
• D)2,847.
• E)10,000.

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Definitions:

Buy Back

Buy back refers to the process by which a company repurchases its own shares from the marketplace, reducing the number of outstanding shares.

Resell

The act of selling something previously bought, often for a profit or at a different price point.

Electronic Bill Pay

A service that allows individuals to pay bills online through a website or app, streamlining the payment process and reducing the need for paper bills.

Switching Costs

Expenses or barriers that a consumer or business faces when changing suppliers, brands, or products.