M & B 4th Edition by Dean Croushore

Exercise 13

The banking market in Athens, Ohio, currently has four banks with market shares of 60 percent, 20 percent, 15 percent, and 5 percent. The two smallest banks have proposed merging. Under the standard merger guidelines of the Federal Reserve and the Justice Department, is the merger likely to be approved? Why or why not? In your answer, be as quantitative as possible.