EconomicsAn industry consists of three firms with sales of $25, $45, and $55.a. Calculate the Herfindahl-Hirschman index (HHI).Instruction: Enter your response rounded to the nearest integer.b. Calculate the four-firm concentration ratio (C4).c. Based on the FTC and DOJ Horizontal Merger Guidelines described in the text, is the Department of Justice likely to attempt to block a horizontal merger between two firms with sales of $25 and $45?

a. Herfindahl-Hirschman index (HHI) is the square of the market sales of the…

Answered: An industry consists of three firms…

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter16: Government Regulation

Section: Chapter Questions

Problem 2E

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Economics

An industry consists of three firms with sales of $25, $45, and $55.

a. Calculate the Herfindahl-Hirschman index (HHI).

Instruction: Enter your response rounded to the nearest integer.

b. Calculate the four-firm concentration ratio (C₄).

c. Based on the FTC and DOJ Horizontal Merger Guidelines described in the text, is the Department of Justice likely to attempt to block a horizontal merger between two firms with sales of $25 and $45?

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