Postmerger herfindahl-hirschman index increase

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Suppose Fiat recently entered into an Agreement and Plan of Merger with Case for $4.3 billion. Prior to the merger, the market for four-wheel-drive tractors consisted of five firms. The market was highly concentrated, with a Herfindahl-Hirschman index of 3,055. Case’s share of that market was 11 percent, while Fiat comprised just 5 percent of the market. If approved, by how much would the postmerger Herfindahl-Hirschman index increase?

Reference no: EM13898500

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