Suppose that an industry has six firms with market shares.
% MARKET SHARES
Firm A
25
Firm B
10
Firm C
7
Firm D
12
Firm E
40
Firm F
6
a. Derive the HHI.
b. Suppose firms C and D propose a merger. Derive post-merger HHI.
c. Might this merger be challenged under the horizontal merger guidelines?