Reference no: EM132274842
Firms market share % HHI<2100 HHI aftrer Lg &HTC merge rHHI after huawei & nokia merger
samsung30 30 _____ _________ __________
apple24 24 _______ __________ _________
huawei16 16 ______ __________ _____________
LG15 15 ____________ __________ ___________
yota5 5 ___________ ___________ _________
htc4 4 ________ __________ __________
motorola3 3 ___________ ____________ _____________
nokia2 2 _________ ____________ ___________
others1 1 __________ ____________ ____________
total 100 ____________ ____________ ______________
A.What is the value of HHI Index of this market? Support the answer with calculations.
B. If LG wants to merge with HTC, then will US Justice Department block this merger if its guidelines state that HHI Index must be equal to 2100 for this industry to be competitive? Support the answer with calculations.
C. Will US Justice Department challenge the merger of Huawei and Nokia under the same guidelines? Support the answer with calculations.
D. Would Apple initiate a price reduction for its phones if it is 95% sure that the rivals will do the same, which could result in a potential $75,000 loss or in potential profit of $1.2 million if the price cut is not matched? Support the answer with calculations.