The sum of the squared values of market shares of firms in an industry is referred to as the
A)concentration ratio.
B)Herfindahl index.
C)variance value.
D)antitrust index.

Question

Quizplus · Accepted Answer

The Herfindahl index, also known as the Herfindahl-Hirschman Index (HHI), is a measure of the size of firms in relation to the industry and an indicator of the amount of competition among them. It is calculated as the sum of the squares of the market shares of all firms in the industry.

The Sum of the Squared Values of Market Shares of Firms