Asked by Bushra Raisa on May 14, 2024
Verified
The highest possible value of the Herfindahl index is 1,000.
Herfindahl Index
A measure of market concentration used to determine the level of competition within an industry, calculated by squaring the market share of each firm competing in the market and then summing the resulting numbers.
- Gain insight into the fundamentals and impacts of oligopolies, highlighting the significance of mutual interdependence.
Verified Answer
HS
Hassaan SajjadMay 15, 2024
Final Answer :
False
Explanation :
The highest possible value of the Herfindahl index is 10,000, which occurs when a market is a monopoly (100% market share squared).
Learning Objectives
- Gain insight into the fundamentals and impacts of oligopolies, highlighting the significance of mutual interdependence.