The largest Herfindahl-Hirschman index possible is _____, and the industry is a(n) _____. 10; monopoly 10,000; monopoly 100,000; oligopoly 100,000; monopoly

Respuesta :

The largest Herfindahl-Hirschman Index that an industry can get is 10,000 and the only industry this is possible in is a Monopoly.

The Herfindahl-Hirschman Index (HHI) is calculated by summing the squares of the market shares of the various companies in an industry.

In a monopoly, a company could have a 100% market share. When this happens, the HHI would be:

= 100 ²

= 10,000

In conclusion, the highest HHI is 10,000 and this can only happen in a monopoly.

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