An industry in which there are five firms each accounting for 20 percent of the market has an HHI of 100.

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Anshita Mahendru · Accepted Answer

Final Answer : False, Explanation :  The Herfindahl-Hirschman Index (HHI) is calculated by summing the squares of the market shares of all firms in the industry. In this case, with five firms each holding 20 percent of the market, the HHI would be 5 * (20^2) = 5 * 400 = 2000.

An industry in which there are five firms each accounting for 20 percent of the market has an HHI of 100.

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