Industries X and Y both have four-firm concentration ratios of 32 percent, but the Herfindahl index for X is 256, while that for Y is 264. These data suggest

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The Herfindahl index is a measure of the size of firms in relation to the industry and an indicator of the amount of competition among them. A higher Herfindahl index indicates a higher level of market concentration, suggesting greater market power. Therefore, with a Herfindahl index of 264, industry Y has greater market power than industry X, which has a Herfindahl index of 256.

Industries X and Y Both Have Four-Firm Concentration Ratios of 32