Use the following table to calculate the Herfindal-Hirshman Index for the U.S. auto market. Would the FTC approve a merger between Gm and Ford? Explain your response. The table is......... GM 19% Ford 17% Toyota 14% Chrysler 11%

Use the following table to calculate the Herfindal-Hirshman Index for the U.S. auto market. Would the FTC approve a merger between Gm and Ford? Explain your response. The table is......... GM 19% Ford 17% Toyota 14% Chrysler 11%

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter15: Oligopoly And Strategic Behavior

Section: Chapter Questions

Problem 13P

See similar textbooks

Related questions

Q: Question 35 Suppose there are 3 firms in a market. The largest firm has sales of $60 million and…

A: The Herfindahl-Hirschman Index (HHI) is used at the marketplace to analyze the market concentration…

Q: Q1: What is the, HHI, Herfindahl-Hirschman Index for an industry where six companies each have a…

A: Disclaimer- “Since you have asked multiple question, we will solve the first question for you as per…

Q: Is it true that a merger between two firms that are not already in the top four by size can affect…

A: Herfindahl-Hirschman Index (HHI) is used to measure market concentration. It reveals the level of…

Q: Let's assume that the table below represents the market shares for the smart phone market. Firm…

A: Ans. The four-firm concentration ratio (CR4) is the measure of the degree of the concentration of…

Q: harge a hig

A: Given : Firm A Price Low High Low 0, 0 50; -40 High -40, 50 10; 10

Q: Why do the United States and many other countries have antitrust laws? What’s so harmful about…

A: The reasons why do the United States and many other countries have antitrust laws are below: Many…

Q: Why some firms favour horizontal merger rather than vertical merger? Provide your answer with…

A: Horizontal versus Vertical Integration: An Overview Horizontal integration and vertical integration…

Q: The New York Times reports that Wal-Mart has decided to challenge Netflix and enter the online…

A: In game theory, Backward induction is an iterative process. It is a theory that reasons backward in…

Q: Economics An industry consists of three firms with sales of $25, $45, and $55. a. Calculate the…

A: Note: We will answer the first question as the exact one was not specified. Please resubmit a new…

Q: ) If two of the firms merge, find the change in the concentration ratio: Concentration ratio change:…

A: market share of 10 firms of equal size is 10% each.

Q: The information below sets out the estimated market shares for the cellular phone manufacturing…

A: Herfindahl- Hirschman index is used to measure competition in the market.

Q: Suppose a proposed merger of firms would simultaneously lessen competition and reduce unit costs…

A: ANS If a merger reduces competition then because of the merger the price of output will increase…

Q: The following table lists the market shares of the eight firms in an industry. Market Shares of…

A: 4 firms Concentration ratio = (S1+ S2+ S3+S4)/ Total industry sales 50+15+15+10/ 100= 90/100 =…

Q: Calculate the 4 firm concentration ratio in a Market where the top 4 firm's have share in the market…

A: # THE FOUR FORM CONCENTRATION RATIO IS GIVEN BY THE SUM OF MARKET SHARE OF THE TOP FOUR FIRMS…

Q: (Mergers and Public Policy) Calculate the Herfindahl-Hirschman Index (HHI) for each of the following…

A: When talking about the Herfindahl-Hirschman Index (HHI), it explains the market concentration based…

Q: Suppose that a small town has six burger shops whose respective shares of the local market are (as…

A: Four-firm concentration ratio of the hamburger industry is percentage of industry sales that we get…

Q: In the 1980s, PepsiCo Inc., which then had 28 percent of the soft-drink market, proposed to acquire…

A: The merging is the strategy used under the oligopoly market where there are only a few large sellers…

Q: Use the table to calculate the Herfindal-Hirschman Index for the U.S. auto market. Would the FTC…

A: Herfindal – Hirschman Index is found by adding the squares of market share of each firm. HHI = 192 +…

Q: Suppose the market shares of Cola-Cola, Pepsi, Anheuser-Busch, Coors, and Miller were 40 percent, 25…

A: # Concentration ratio in a market can be computed by emphasizing on the top 4 big firm's. We just…

Q: Consider an industry consists of three firms (Firm-A, Firm-B and Firm-C) with sales of AED300,000,…

A: Given: Firm Sales A 300,000 B 700,000 C 250,000

Q: The table shows sales information for the firms in three different markets. Use the…

A: Herfindahl- Hirschman index is used to measure the concentration level of the market. Higher the…

Q: The table shows a hypothetical demand schedule for monosodium glutamate (MSG). Ajinomoto holds 5050%…

A: Profit maximizing firm produces output at the point where the marginal revenue is equal to or just…

Q: Based only on the knowledge that the premerger market share of two firms proposing to merge was 30…

A: HHI index is the index for competitiveness in the market it is the squared summation of each firm It…

Q: An industry consists of three firms with sales of $300,000, $700,000 and $250,000. a) Calculate the…

A: (1)Assume,Firm A sales = $3, 00, 000Firm B sales = $7, 00, 000Firm C sales = $2, 50, 000Therefore,…

Q: Company Market Share Toshiba 10% Dell 10% HP 15% Sony 10% Refer to the table above, which details…

A: "The Herfindahl-Hirschman Index or HHI is used to measure the market concentration and to determine…

Q: Is it true that the four-firm concentration ratio puts more emphasis on one or two very large firms,…

A: The Four-Firm Concentration Ratio The concentration ratio was the earliest tool developed to measure…

Q: P 14 13 12 11 10 9 8 7…

A: Price ($) Quantity Total Revenue Marginal Revenue Marginal Cost Total Cost Profit 14 50 700…

Q: Firm Market Share 1 3030 2 2828 3 2323 4 1010 5 44 6 33 7 11 8 11 Calculate the…

A: The HHI {Herfindahl-Hirschman index} is described as a common or usual measure of the market…

Q: The following table lists the market shares of the eight firms in an industry. Market Shares of…

A: Four firm concentration ratio (C4) = Share of top 4 companies in the market

Q: The table below shows the payoffs for two firms competing through advertisement. Firm A and Firm B…

A: Nash equilibrium is the intersections of best responses of the all the player and it is non…

Q: In January 2007, XM enjoyed about 58 percent of satellite radio subscribers, and Sirius had the…

A: As Economic consultants i would present to the DOJ to persuade it not to challenge the merger , the…

Q: The Herfindahl index for 5 equal firms is 2000 and then a merger occurs between two of the firms and…

A: As per Herfindahl index,X=each firm market share5(x2)=2000x2=20005x2=400x=20

Q: What would the Herfindahl-Hirschman Index (HHI) be in each of the following situations? 1 firm with…

A: The HHI is calculated by squaring each rival firm's market share and then adding the resulting…

Q: A market has the following demand function: P = 120 - where Qe = E-1 Qi a) Assuming Cournot-Nash…

A: An oligopoly market is one that has few large firms which are interdependent selling homogenous as…

Q: Suppose that a small town has seven burger shops whose respective shares of the local hamburger…

A: a. Concentration ratio is a sum of market shares of top four firms Concentration ratio = 25 + 22 +…

Q: What is the difference between a vertical merger and a horizontal merger? Give an example of each…

A: Merger: it is a combination of two existing firms which turns into a new single entity. Merger…

Q: Suppose that the most popular car dealer in your area sells 2 percent of all vehicles. Instructions:…

A: Herfindahl index (HHI) can be calculated by using the following formula.

Q: Find the attached file.

A: Given: To Find: The four-firm concentration ratio in the industry will be:

Q: Suppose an industry is composed of eight firms with the following market shares:A 30% E…

A: The concentration of market is calculated by the Herfindahl-Hirschman Index (HHI). The value of HHI…

Q: Suppose that a small town has seven burger shops whose respective shares of the local hamburger…

A: The four firm concentration ratio is found by adding the market shares of the four largest firms.…

Q: Question 190 of 190 FINAL - Social Studies In recent years, the top two manufacturers of soft…

A: Here, it is given that top two manufacturers in the soft drink industry purchase other two…

Q: Step 1 of 2: Use the following table with the sample data to calculate the four-firm concentration…

A: The 4-firm concentration ratio (C4) measures the total market share held by top 4 firms in the…

Q: Suppose an industry that has 10 firms. Below are the market shares for 2008 and 2013 of the 10…

A: Since you have posted multiple sub-parts, we are answering the first three for you. If you want a…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Use the following table to calculate the four=firm concentration ratio for the U. S. auto market. Does this indicate a concentrated market or not? The table is............. GM 19% Ford 17% Toyota 14% Chrysler 11%
Use the table to calculate the Herfindal-Hirschman Index for the U.S. auto market. Would the FTC approve a merger between GM and Ford?
I am intrigued by the following article detailing how Nestle agreed to pay Starbucks $7.2B to distribute and sell Starbucks’ packaged coffees and teas around the world. Why would Nestle purposely put its competitors’ brands right next to it in the store, and then pay them for the privilege? Why wouldn’t Starbucks just take care of distributing its own brands rather than go through Nestle? Please explain how this outcome could be profit maximizing for both firms
In January 2007, XM enjoyed about 58 percent of satellite radio subscribers, and Sirius had the remaining 42 percent. Both firms were suffering losses, despite their dominance in the satellite radio market. In 2008, the DOJ decided not to challenge a merger, and these two firms united to become Sirius XM. If you were an economic consultant for Sirius, what economic arguments would you have presented to the DOJ to persuade it not to challenge the merger? Explain
The table below shows market share data for different firms producing desks. Market Share in % 15 18 7 11 6 10 4 5 5 16 Firm Aardvark Inc Baluga, LLC Cran Inc Delta Co Echo Co Farriss Co Gum Drop Inc Hill Corp Indigo Corp Jackson Co What is the Herfindahl Hirschman Index (HHI) for this market? ← HHI 225 324 49 121 36 100 16 25 25 256 Suppose that Delta Co and Gum Drop Inc are considering a merger. What will the HHI be after this merger?
35. Use Table 11.5 to calculate the four-firm concentration ratio for the U.S. auto market. Does this indicate a concentrated market or not? GM 19% Ford 17% Toyota 14% Chrysler 11% Table 11.5 Global Auto Manufacturers with Top Four U.S. Market Share, June 2013 (Source: http://www.zacks.com/commentary/27690/auto- industry-stock-outlook-june-2013)
The following table lists the market shares of the eight firms in an industry. Market Shares for Eight Firms in an Industry Firm Market Share 1 3030 2 2828 3 2323 4 1010 5 44 6 33 7 11 8 11 Calculate the Herfindahl-Hirschman Index (HHI) for this industry. Enter your answer in the box below, and round to the nearest whole number if necessary.
QUESTION 9 After a complex process of mergers and acquisitions, the technology company Globocorp Enterprises has acquired control of all the world's sigmantium (which is a semi-conductor that is essential to manufacture mobile phones). As a result of its control of international sigmantium production, Globocorp Enterprises is now the world's only supplier of mobiles and it therefore operates as a profit maximising monopolist in this market. Their marginal cost of production for each mobile is $160 per phone. Below is a table of prices Globocorp can charge for each mobile that it produces, and the corresponding quantities sold on any given day. Price ($/mobile phone) 400 380 360 340 320 300. Quantity (mobile phones) 45000 50000 55000 60000 65000 70000 What is Globocorp Enterprises' daily revenue at the profit maximising level of production? Answer to the nearest whole number (with no decimal places or $ sign), and only use the options in the table above.
Suppose there are only two automobile companies,Ford and Chevrolet. Ford believes that Chevrolet will match any price it sets, but Chevrolet too is interested in maximizing profit. Use the following price and profit data to answer the following questions. a. What price will Ford charge?b. What price will Chevrolet charge once Ford has set its price?c. What is Ford’s profit after Chevrolet’s response?d. If the two firms collaborated to maximize joint profits, whatprices would they set?e. Given your answer to part (d), how could undetected cheatingon price cause the cheating firm’s profit to rise?
Suppose that a small town has seven burger shops whose respective shares of the local hamburger market are (as percentages of all hamburgers sold): 23 percent, 22 percent, 18 percent, 12 percent, 11 percent, 8 percent, and 6 percent. Instructions: Enter your answers as a whole number. a. What is the four-firm concentration ratio of the hamburger industry in this town? percent b. What is the Herfindahl index for the hamburger industry in this town? c. If the top three sellers combine to form a single firm, what would happen to the four-firm concentration ratio and to the Herfindahl index? Four-firm concentration ratio = percent Herfindahl index =
In the 1980s, PepsiCo Inc., which then had 28 percent of the soft-drink market, proposed to acquire the Seven-Up Company. Shortly thereafter, the Coca-Cola Company, with 39 percent of the market, indicated it wanted to acquire the Dr Pepper Company. Seven-Up and Dr Pepper each controlled about 7 percent of the market. In your judgment, was the government’s decision to block these mergers appropriate?
1.1 Read the following extract and answer question 1.1, 1.2. Evidence of domination Both the Competition Commission and Icasa found, in their inquiries, that Vodacom and MTN are dominant across the supply chain. Their dominance is even more entrenched by the spectrum-sharing deals that they have entered into with Cell C, Liquid Intelligent Technologies and Rain. Cell C is wholly reliant on MTN and Vodacom to provide mobile services, and Liquid and Rain are disincentivised from competing aggressively in the mobile market due to the lucrative deals they have struck to provide capacity to either Vodacom or MTN, or both. This has limited their ability to compete independently- leaving Telkom as the only entity in the position to be able to challenge the "cosy" market structure head-on. The economic argument being expressed in this extract is that of and has the consequence of a) Market failure, externalities. b) Government failure, public goods being under-produced. c) Market failure,…