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An industry consists of three firms with sales of $200,000, $710,000, and $325,000.

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

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 $200,000 and $325,000?

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Yusra Anees
Yusra AneesLv10
28 Sep 2019

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An industry consists of six firms with sales of $2.1 billion, $5 billion, $0.7 billion, $8 billion, $9 billion and $4 billion.

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

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

c. Based on the U.S. Department of Justice's Merger Guidelines described in the text, do you think the Department of Justice would block a horizontal merger between the two firms with sales of $2.1 billion and $5 billion?

Explain, and support your explanation with calculations

1. An industry consists of six firms with sales (revenue) of $2.1 billion, $5 billion, $0.7 billion, $8 billion, $9 billion and $4 billion. a. Calculate the Herfindahl-Hirschman Index (HHI). b. Calculate the four-firm concentration ratio (C4). c. Based on the U.S. Department of Justice's Merger Guidelines described in the text, do you think the Department of Justice would block a horizontal merger between the two firms with sales of $2.1 billion and $5 billion? Explain, and support your explanation with calculations

The widget industry is comprised of six firms of varying sizes. Firm 1 has 35 percent of the market. Firm 2 has 25 percent, and the remaining firms have 10 percent each.

a) what is the four firm concentration ratio for the industry?

b)What is the Herfindahl-Hirschman index for the widget industry?

c) based on the depatment of justice merger guidlines descrideb in the textbook, if the Herfindahl-Hirschman index is between 1500 and 2500 after a merger, and the merger increase the Herfindahl-Hirschman index by more then 100, the FTC and DOJ may challenge the merher. do youthnik the justice department would be lilkely to block a merger between firm 5 and 6? show your work

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