The HHI is equal to the sum of the squares of the market share of each firm in the industry. Therefore if you take the square of 50 percent and add it to the square of 1 percent multiplied by 50 (because there are 50 firms with 1 percent market share), you will get an HHI of 2,550.

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The Answer of The HHI is equal to the sum of the squares of the market share of each firm in the industry. Therefore if you take the square of 50 percent and add it to the square of 1 percent multiplied by 50 (because there are 50 firms with 1 percent market share), you will get an HHI of 2,550.

The HHI Is Equal to the Sum of the Squares