Nationwide Bank has approached Hometown bank with a proposal to merge. The following table list the sales of the banks in the area. Use this information to calculate the four-firm concentration ratio and the Herfindahl-Hirschman index. Based on the the US department of justice merger guidelines, do you think the Justice Department is likely to challenge the proposed merger?
Bank Name
Mega bank 900 (million in sales)
city bank 850
Nationwide 735
Atlantic Savings 555
Bulk Bank 345
Metropolitan Bank 340
American Bank 265
Hometown Bank 120
Urban Bank 90