Suppose two companies attempt to merge, and they operate in an industry where the postmerger Herfindahl-Hirschman index is 2,900 and the increase in the Herfindahl-Hirschman index from the merger is 225.
Which of the following is NOT a condition that would improve the likelihood of the Justice Department approving the merger?
a. The HHIs are based on too narrow a definition of the product market.
b. There are significant diseconomies of scope.
c. One of the firms is in financial trouble.
d. There are significant economies of scale.
e. There is notable foreign competition.
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Home » Business » Suppose two companies attempt to merge, and they operate in an industry where the postmerger Herfindahl-Hirschman index is 2,900 and the increase in the Herfindahl-Hirschman index from the merger is 225.