Calculate the Herfindahl-Hirschman Index (HHI) for each year using deposits and comment on the level of competition
| Year. Bank. Deposits |
| 2018 STANBIC. 6,205,018 |
| 2019. Stanbic. 9,295,682 |
| 2020 STanbic. 12,742,132 |
|
2018. BARCLAYS. 7,657,089 2019 Absa. 10,139,424 2020 Absa. 10,598,067
Calculate the Herfindahl-Hirschman Index (HHI) for each year using deposits and comment on the level of competition |
Here we are given the data about deposits of banks in years 2018, 2019 and 2020.
We have to find HHI for each year and comment on level of competition.
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When the HHI is less than 1500, the market price is a competitive one, while, when the HHI is
Question
Are your conclusions for HHI consistent with the five-firm
concentration in all cases? Give two reasons to support your answer.
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