The Herfindahl-Hirschman Index (HHI), a commonly accepted measure of market concentration. If the value of the HHI is less than 1,000, the Justice Department considers an industry as competitive, or unconcentrated. An index between 1,500 and 2,500 is considered representative of a moderately concentrated industry, and an index greater than 2,500 is representative of a highly concentrated industry. If a transaction increases the HHI by more than 200 points in highly concentrated markets, the Justice Department is likely to take antitrust actions. Suppose that in the market for sunglasses, market share is divided among six companies in the following manner: Firm Sun Shades Cool Shades UV Shield Shady Eyewear Tinted Windows Sun Fashion Market Share 60% 15% 10% 8% 5% 2% Before the merger, the value of the Herfindahl index is market for sunglasses is which means that the . And after the merger, the HHI is Based on the Herfindahl index of the market for sunglasses, the FTC should merger between Cool Shades and Sun Fashion.

The Herfindahl-Hirschman Index (HHI), a commonly accepted measure of market concentration. If the value of the HHI is less than 1,000, the Justice Department considers an industry as competitive, or unconcentrated. An index between 1,500 and 2,500 is considered representative of a moderately concentrated industry, and an index greater than 2,500 is representative of a highly concentrated industry. If a transaction increases the HHI by more than 200 points in highly concentrated markets, the Justice Department is likely to take antitrust actions. Suppose that in the market for sunglasses, market share is divided among six companies in the following manner: Firm Sun Shades Cool Shades UV Shield Shady Eyewear Tinted Windows Sun Fashion Market Share 60% 15% 10% 8% 5% 2% Before the merger, the value of the Herfindahl index is market for sunglasses is which means that the . And after the merger, the HHI is Based on the Herfindahl index of the market for sunglasses, the FTC should merger between Cool Shades and Sun Fashion.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: 4) Use the figure below to answer the following questions. Price and cost (dollars per unit) 80 MC…

A: In monopolistically competitive market, there are large number of firms selling differentiated…

Q: A product market has only one seller.. There are no close substitutes for the product. What type of…

A: In Economics, different market types are determined based on various factors like the nature of…

Q: Table 17-5 The table shows the town of Driveaway's demand schedule for gasoline. Assume the town's…

A: Collusion occurs when two or more firms decide to join hands and set price or quantity in such a way…

Q: The curve that shows average revenue is the supply demand Onone of the above O marginal-revenue…

A: Revenue refers to the income earned by the firm by selling a certain quantity of its output. Average…

Q: 25) What is the profit-maximizing price? 26) What is the profit-maximizing quantity? 27) What is…

A: 25. Profit maximizes at the level, MR = MC Thus the price of $38 will maximize the profit because…

Q: If a company with market pewer is not making enongh profit (in equilibrinm), a. the price will drop,…

A: The producers and consumers exchange goods and services in a place called the market. The demand and…

Q: In a market this is highly competitive with little product differentiation and easy market entry,…

A: When the market is highly competitive with little product differentiation. This implies the market…

Q: a. Graph a purely competitive market showing the point of equilibrium at a price of $150 and a total…

A: Pure competition is a type of market structure in which there are large numbers of buyers and…

Q: Which of the following statements regarding perfect price discrimination is false? Question 7Answer…

A: The objective of the question is to identify the false statement among the given options related to…

Q: monopolistic competition

A: In a market with monopolistic competition, there are numerous rival companies that each provide a…

Q: Mark is looking to purchase a second-hand car. Within 20 minutes from Mark's house, there are 10…

A: Marginal Benefit (MB): The additional satisfaction or value a person gains from consuming one more…

Q: For which firm can marginal revenue become negative? ● a. monopoly firms, since price is equal to…

A: Monopoly is a form of imperfect competition. There is one firm. The number of consumers is high.…

Q: Dollars A 3 A) CJEO B) BHEO OC) AJEO H K D) AJHB G MR ELM MC Refer to the above diagram. At profit…

A: The demand curve is the graphical representation of the quantity of a commodity demanded by…

Q: The table below contains some revenue and cost data for the Rising Moon T-shirt Company (quantities…

A: Disclaimer- “Since you have asked multiple questions, we will solve the first three questions for…

Q: Which of the following statements is true ?

A: Correct answer is option B . A firm should increase quantity as long as price is greater than…

Q: Complete the following table and identify the profit maximising and output. b. What is true about…

A: Total Revenue = Price X Quantity Marginal Revenue = Change in total revenue when an additional…

Q: 15. In monopolistic competition. (a) there is no entry and exit. (b) each firm produces slightly…

A: Monopolistic competition refers to a market structure in which there are many firms. There is free…

Q: 6. A-One bakery in Brampton sells 350 fruit cakes slices each month for $3.25 each. They are looking…

A: Given information: A-one bakery sells 350 fruit cake slices each month for $3.25 each. Each $0.10…

Q: Refer to the accompanying figure to answer the following questions. Price $25 $13 $10 100 MC MR D…

A: Profit maximization is when the firm receives the highest profits in the market. Profit maximization…

Q: 19. Dani sells roses in a competitive market where the price of a rose is $8. Use this information…

A: In case of Perfect Competition a firm maximizes profit by producing output at level where Price is…

Q: profit-maximizing quantity? 2) Below what price will the firm shut-down? 3) What are operating…

A: The firm keeps on producing as long as it is able to recover the average variable cost.

Q: In a perfectly competitive market Select one: a. each firm takes the good's price as given to it by…

A: When talking about perfectly competitive market, it is said that it is the most common market form…

Q: t a student café, there are equal numbers of two types of customers with the following values. The…

A: Price discrimination is, in general, a monopolistic characteristic. This is due to the fact that in…

Q: Compare and contrast the decision-making processes of a competitive firm versus a monopoly firm. a.…

A: Monopoly is kind of market set-up with a single buyer and very difficult to entry in such kind of…

Question

Unsure how to solve this problem set Blank one: a. highly concentrated b. moderately concentrated c. competitive Blank two: a. not challenge b. challenge c. encourage

The Herfindahl-Hirschman Index (HHI), a commonly accepted measure of market
concentration. If the value of the HHI is less than 1,000, the Justice Department considers
an industry as competitive, or unconcentrated. An index between 1,500 and 2,500 is
considered representative of a moderately concentrated industry, and an index greater
than 2,500 is representative of a highly concentrated industry. If a transaction increases
the HHI by more than 200 points in highly concentrated markets, the Justice Department
is likely to take antitrust actions.
Suppose that in the market for sunglasses, market share is divided among six companies in the
following manner:
Firm
Sun Shades
Cool Shades
UV Shield
Shady Eyewear
Tinted Windows
Sun Fashion
Market Share
60%
15%
10%
8%
5%
2%
Before the merger, the value of the Herfindahl index is
market for sunglasses is
which means that the
And after the merger, the HHI is
Based on the Herfindahl index of the market for sunglasses, the FTC should
merger between Cool Shades and Sun Fashion.
a

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Introduction

VIEW

Step 2: Working

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

12. A current shortage is due to a price ceiling. If the price ceiling is removed, a. price would increase, quantity supplied would increase, and quantity demanded would decrease b. price would increase, quantity supplied would decrease, and quantity demanded would increase c. price would decrease, quantity supplied would increase, and quantity demanded would decrease d. price would decrease, quantity supplied would decrease, and quantity demanded would increase 13. Adverse selection refers to a. the phenomenon that occurs when one party in an exchange takes advantage of knowing more than another party b. the tendency for individuals to alter their behaviour once they are insured against loss c. the tendency for individuals to engage in insurance fraud d. both the tendency for individuals to alter their behaviour once they are insured against loss and the tendency for individuals to engage in insurance fraud
7) What is total fixed cost at the profit-maximizing quantity?
If a firm charges a lower price they will have a lower profit margin but a higher profit; if a firm charges a higher price they will have a higher profit margin but a lower profit. Which of the following statements is accurate? A. The firm should charge a lower price for the higher profit. B. The firm should a higher price for the lower profit. C. The firm should charge a higher price for the higher profit margin. D. Whether the firm should charge a higher price or lower price indeterminate.
4. Hundreds of music stores have been closing in the face of stagnant demand for CDs because of new competition by online music vendors. a. How would price competition from these new sources cause a retail store to close? b. In the long run, will CDs remain a viable product? If so, how?
pls solve this ques in clear handwriting in 10-15 minutes I'll give you multiple upvotes
The profit-maximizing price is ______
1) What is the profit-maximizing price?2) What is the profit-maximizing quantity?3) What is total revenue at the profit-maximizing quantity?
A firm that is producing the quantity at which marginal cost exceeds both average total cost and the market price will increase its economic profit by a. producing a smaller quantity b. producing a smaller quantity c. raising the price to equal marginal cost d. producing the quantity that minimises average total cost e. producing a larger quantity
|Price Demanded Revenue Revenue Marginal Cost Cost $24 1000 $24,000 ** $15,000 ** ** ** $22 1250 $27,500 $14 $17,000 $8 $20 1500 $10 $19,500 $10 $18 1750 $31,500 Y $23,000 $14 $16 2000 $32,000 $2 $27,000 Z (a) Calculate total revenue at X. (b) Calculate marginal revenue at Y. (c) Calculate marginal cost at Z. (d) Find the profit maximizing price. (e) Find the profit maximizing quantity. (f) Find the profit the firm will earn.
Identify the strategy with respect to product/market grid and explain. a. Knoor noodles now available in Rs. 20 pack. (Smaller than normal size) b. Baskin Robins (an international ice cream chain) offered new flavor. c. Mothercare baby product firm started California pizza business.