Suppose that two firms in an industry that has a Herfindahl index of 2,000 announce a merger. The U.S . Justice Department concludes the merger will boost the index to 2, 200. The antitrust authorities will most likely Multiple Choice ignore the merger. allow the merger, but strictly regulate the prices set by the new combined firm. prevent this merger because of the relatively large size of, and increase in, the Herfindahl index. allow the merger, but only if foreign entry to the industry is possible.

Suppose that two firms in an industry that has a Herfindahl index of 2,000 announce a merger. The U.S . Justice Department concludes the merger will boost the index to 2, 200. The antitrust authorities will most likely Multiple Choice ignore the merger. allow the merger, but strictly regulate the prices set by the new combined firm. prevent this merger because of the relatively large size of, and increase in, the Herfindahl index. allow the merger, but only if foreign entry to the industry is possible.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter15: Oligopoly And Strategic Behavior

Section: Chapter Questions

Problem 8P

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