Is it true that a merger between two films that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshmau Index? Explain briefly.

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Answer 1

Textbook Question

Chapter 11, Problem 1SCQ

Is it true that a merger between two films that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshmau Index? Explain briefly.

Expert Solution & Answer

To determine

Whether it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer to Problem 1SCQ

Yes, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Explanation of Solution

Since, the market shares of all the firms are included in the HHI calculation, so when there is a merger between the two firms the HHI will change.

So, in the case of four- firm concentration ratio it is possible that the merger between let’s say the 6^th and the 5^th largest firms in the market would create a new firm that may be ranked in the top four in the market.

So, in the case mentioned above a merger of the two firms that are neither in the top four, but still they would change the four-firm concentration ratio.

So, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

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Is it true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Her findahl-Hirshman Index? Explain briefly.

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Question C2 The Australian Competition and Consumer Commission (ACCC) has opened an investigation regarding collusion between the two major firms producing fire protection gear for bush firefighters. The firms - Azure Associates and Blue Guard - contend that they are quantity competitors and that the prices they are charging are a result of an increase in price by their suppliers. As part of the case, the ACCC has noted that the Australian firefighters typically purchase their own protective gear and are thus price takers in the market. Both the ACCC and the two firms under investigation agree that the market demand can be described by the inverse demand function: P(Q)=240-Q, where Q is the total quantity provided by the two firms (i.e., Q=q₁ + 9B, where is the 9A amount produced by Azure Associates and q, is the amount produced by Blue Guard). All parties also agree that the two firms have identical production technologies and that the two firms have the same constant marginal cost of…

Answer 2

Textbook Question

Chapter 11, Problem 1SCQ

Is it true that a merger between two films that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshmau Index? Explain briefly.

Expert Solution & Answer

To determine

Whether it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer to Problem 1SCQ

Yes, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Explanation of Solution

Since, the market shares of all the firms are included in the HHI calculation, so when there is a merger between the two firms the HHI will change.

So, in the case of four- firm concentration ratio it is possible that the merger between let’s say the 6^th and the 5^th largest firms in the market would create a new firm that may be ranked in the top four in the market.

So, in the case mentioned above a merger of the two firms that are neither in the top four, but still they would change the four-firm concentration ratio.

So, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Textbook Question

Chapter 11, Problem 1SCQ

Is it true that a merger between two films that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshmau Index? Explain briefly.

Expert Solution & Answer

To determine

Whether it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer to Problem 1SCQ

Yes, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Explanation of Solution

Since, the market shares of all the firms are included in the HHI calculation, so when there is a merger between the two firms the HHI will change.

So, in the case of four- firm concentration ratio it is possible that the merger between let’s say the 6^th and the 5^th largest firms in the market would create a new firm that may be ranked in the top four in the market.

So, in the case mentioned above a merger of the two firms that are neither in the top four, but still they would change the four-firm concentration ratio.

So, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Textbook Question

Chapter 11, Problem 1SCQ

Is it true that a merger between two films that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshmau Index? Explain briefly.

Expert Solution & Answer

To determine

Whether it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer to Problem 1SCQ

Yes, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Explanation of Solution

Since, the market shares of all the firms are included in the HHI calculation, so when there is a merger between the two firms the HHI will change.

So, in the case of four- firm concentration ratio it is possible that the merger between let’s say the 6^th and the 5^th largest firms in the market would create a new firm that may be ranked in the top four in the market.

So, in the case mentioned above a merger of the two firms that are neither in the top four, but still they would change the four-firm concentration ratio.

So, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Textbook Question

Answer 6

Textbook Question

Answer 7

Expert Solution & Answer

To determine

Whether it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer to Problem 1SCQ

Yes, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Explanation of Solution

Since, the market shares of all the firms are included in the HHI calculation, so when there is a merger between the two firms the HHI will change.

So, in the case of four- firm concentration ratio it is possible that the merger between let’s say the 6^th and the 5^th largest firms in the market would create a new firm that may be ranked in the top four in the market.

So, in the case mentioned above a merger of the two firms that are neither in the top four, but still they would change the four-firm concentration ratio.

So, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer 8

Expert Solution & Answer

To determine

Whether it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer to Problem 1SCQ

Yes, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Explanation of Solution

Since, the market shares of all the firms are included in the HHI calculation, so when there is a merger between the two firms the HHI will change.

So, in the case of four- firm concentration ratio it is possible that the merger between let’s say the 6^th and the 5^th largest firms in the market would create a new firm that may be ranked in the top four in the market.

So, in the case mentioned above a merger of the two firms that are neither in the top four, but still they would change the four-firm concentration ratio.

So, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

To determine

Whether it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer 12

Answer to Problem 1SCQ

Yes, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer 13

Explanation of Solution

Since, the market shares of all the firms are included in the HHI calculation, so when there is a merger between the two firms the HHI will change.

So, in the case of four- firm concentration ratio it is possible that the merger between let’s say the 6^th and the 5^th largest firms in the market would create a new firm that may be ranked in the top four in the market.

So, in the case mentioned above a merger of the two firms that are neither in the top four, but still they would change the four-firm concentration ratio.

So, it is true that a merger between two firms that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshman Index.

Answer 14

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Is it true that a merger between two films that are not already in the top four by size can affect both the four-firm concentration ratio and the Herfindahl-Hirshmau Index? Explain briefly.

Answer to Problem 1SCQ

Explanation of Solution

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