Answer Happy

Problem 3. Market Concentration (1 point In 2019, the retail industry in the Czech Republic is characterized by the existence of 8 chains offering iden- tical products. Two of them announced plans to leave the market and sell their stores to another chain in the market. The corresponding market shares 8i, =1, ..., 8, are given in the following table: Country Firms Concentration Index 1 3 14 HHI 2019 10% 15% 15% 8% 6% 6% 5% 5% 2020 63% 15% 15% 0% 6% 6% 5% 0% 2 6 7 8 (*) Compute the concentration measures 14 and HHT for both years. (b) compute the change in concentration resulting from the acquisition of stores by firm 1, A4, = 7920 - 2010 and AHHHH/2/20 - 11/2019 (e) Which index represents concentration more precisely? Would you advise the Czech anti-trust regulatory body to approve the acquisition? Explain why or why not.