The Herfindahl-Hirschman Index Is One Factor Used to Determine Whether

question 76

Multiple Choice

The Herfindahl-Hirschman Index is one factor used to determine whether a merger between two firms should be allowed.Which of the following statements regarding the value of the Index for a given industry is true?

• A)If a merger would result in an Index value less than 1,000, the merger would not be challenged.
• B)If a merger would result in an Index value of 1,000 or more, the industry would be considered a monopoly and the merger would be challenged.
• C)If a merger resulted in an Index of between 1,000 and 1,800, the industry would be considered competitive and the merger would not be challenged.
• D)If a merger would increase the Index by 100, the industry would be considered a monopoly and the merger would be challenged.

---

Definitions:

Net Worth

The total value of an individual's or organization's assets minus their liabilities.

Net Worth

The difference between the total assets and total liabilities of an individual or business.

Normative Question

A question that addresses how things should be rather than how they are, often involving subjective judgments and values.

Tax Base

The total amount of assets or income that can be taxed by a government, serving as a critical source of fiscal revenue.