Homework Answers
Answer :
As per the information provided in the question, there are a total of 5 firms in the market.
With market shares as 37%, 37%, 8.67%, 8.67%, 8.67% respectively.
Now the Herfindahl-Hirschman Index (HHI) is calculated by squaring the market shares of each of these firms (that is here 5 firms) in an industry and then adding them.
HHI = 37^2 + 37^2 + 8.67^2 + 8.67^2 + 8.67^2 = 2963.5067
HHI = 2963.5 (rounding off to one decimal place)
Answer : Option A) 2,963.5
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