If an Industry Currently Has a Herfindahl Index of 900

question 155

Multiple Choice

If an industry currently has a Herfindahl index of 900 and a merger would raise that to 950, then the Department of Justice would generally

• A)challenge the merger because the index would become too large
• B)challenge the merger because the change in the index is too large
• C)not challenge the merger because the postmerger index is less than 1, 800
• D)not challenge the merger if it is a horizontal merger
• E)challenge the merger if it is a vertical merger

---

Definitions:

Accounts Receivable

The money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Collateral

Collateral is an asset that a borrower offers to a lender to secure a loan. If the borrower fails to repay the loan, the lender has the right to seize the collateral.

Line of Credit Agreement

A legal agreement between a financial institution and a borrower that establishes a maximum loan balance that the lender allows the borrower to access.

Specified Period

A defined duration or timeframe during which certain actions, events, or conditions are intended to take place or be in effect.