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In: Economics

If one market has an HHI of .25 and another has an HHI of .3, the...

If one market has an HHI of .25 and another has an HHI of .3, the one with an HHI of .25 is more __________

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Expert Solution

Answer: Competitive.

Explanation: HHI stands for Herfindahl–Hirschman Index which indicates the level of competition in an industry. HHI is calculated by taking the sum of the market shares of the firms in an industry. The value ranges from 0 to 1 where 0 means perfect competition and 1 means pure monopoly. So, the lower the value the more competitive the industry is.

Rahul Sunny answered 2 years ago
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