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.

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