The following three Fls dominate a local market and their total assets are given below. Institution Bank A Bank B Bank C Asset Size $50 million $60 million $90 million Under the 1982 guidelines, would the Fed approve the merger of Banks A and C? It is likely to approve because it is not a concentrated market. It is unlikely to approve because the post-merger HHI has increased by over 100. It is likely to approve because the post-merger HHI has increased by over 100. O Likely to approve because the post-merger HHI has increased by less than 5,000. It is unlikely to approve because the post-merger HHI has increased by an amount over 5,000.

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter3: Evaluation Of Financial Performance
Section: Chapter Questions
Problem 20P
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The following three Fls dominate a local market and their total assets are given below.
Institution
Asset Size
Bank A
$50 million
Bank B
$60 million
Bank C
$90 million
Under the 1982 guidelines, would the Fed approve the merger of Banks A and C?
It is likely to approve because it is not a concentrated market.
It is unlikely to approve because the post-merger HHI has increased by over 100.
It is likely to approve because the post-merger HHI has increased by over 100.
Likely to approve because the post-merger HHI has increased by less than 5,000.
It is unlikely to approve because the post-merger HHI has increased by an amount over 5,000.
Transcribed Image Text:The following three Fls dominate a local market and their total assets are given below. Institution Asset Size Bank A $50 million Bank B $60 million Bank C $90 million Under the 1982 guidelines, would the Fed approve the merger of Banks A and C? It is likely to approve because it is not a concentrated market. It is unlikely to approve because the post-merger HHI has increased by over 100. It is likely to approve because the post-merger HHI has increased by over 100. Likely to approve because the post-merger HHI has increased by less than 5,000. It is unlikely to approve because the post-merger HHI has increased by an amount over 5,000.
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