A 1,000-point change in the Herfindahl-Hirschman index corresponds roughly to a merger of two firms, each with a 7 percent share of the market.

Question

Quizplus · Accepted Answer

A 1,000-point change in the Herfindahl-Hirschman index does not correspond to a specific merger scenario. The impact of a 1,000-point change on market concentration would depend on the initial level of concentration and the distribution of market shares among firms in the market.

A 1,000-Point Change in the Herfindahl-Hirschman Index Corresponds Roughly to a Merger