The Herfindahl-hirschman index is calculated by taking _______, squaring it, and adding them up to get a total.
A) concentration ratio of each firm in the industry
B) total revenues of each firm in the industry
C) market share of each firm in the industry
D) market capitalization of each firm in the industry

Question

Quizplus · Accepted Answer

The Herfindahl-Hirschman Index (HHI) is calculated by taking the market share of each firm in the industry, squaring it, and then summing these squares to get a total. This method provides a measure of market concentration and competition.

The Herfindahl-Hirschman Index Is Calculated by Taking _______, Squaring It