At one time Mattel proposed acquiring Fisher-Price for $1.2 billion. At the time, Mattel was a major player in the toy industry with 11 percent of the market. Fisher-Price had 4 percent. The other two large firms were Tyco, with a 5 percent share, and Hasbro, with a 15 percent share. In the infant/preschool toy market, Mattel had an 8 percent share and Fisher-Price had a 27 percent share, the largest. The other two large firms were Hasbro, with a 25 percent share, and Rubbermaid, with a 12 percent share. a. What were the approximate Herfindahl and four-firm concentration ratios for these industries? (Assume all other firms in each industry had 1 percent of the market each.) Toy market The four-firm concentration ratio: The Herfindahl index: [ Infant/preschool toy market The four-firm concentration ratio: The Herfindahl index: b. If you were Mattel's economist, which industry definition would you suggest using in court if the merger was challenged by the government? Toy market O Infant/preschool toy market

At one time Mattel proposed acquiring Fisher-Price for $1.2 billion. At the time, Mattel was a major player in the toy industry with 11 percent of the market. Fisher-Price had 4 percent. The other two large firms were Tyco, with a 5 percent share, and Hasbro, with a 15 percent share. In the infant/preschool toy market, Mattel had an 8 percent share and Fisher-Price had a 27 percent share, the largest. The other two large firms were Hasbro, with a 25 percent share, and Rubbermaid, with a 12 percent share. a. What were the approximate Herfindahl and four-firm concentration ratios for these industries? (Assume all other firms in each industry had 1 percent of the market each.) Toy market The four-firm concentration ratio: The Herfindahl index: [ Infant/preschool toy market The four-firm concentration ratio: The Herfindahl index: b. If you were Mattel's economist, which industry definition would you suggest using in court if the merger was challenged by the government? Toy market O Infant/preschool toy market

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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