If an industry currently has a Herfindahl index of 900 and a merger would raise that to 950, then the Department of Justice would generally
A)challenge the merger because the index would become too large
B)challenge the merger because the change in the index is too large
C)not challenge the merger because the postmerger index is less than 1, 800
D)not challenge the merger if it is a horizontal merger
E)challenge the merger if it is a vertical merger

Question

Quizplus · Accepted Answer

The Department of Justice generally does not challenge mergers if the post-merger Herfindahl index is below 1,800, as it indicates a moderately concentrated market.

If an Industry Currently Has a Herfindahl Index of 900