CFA考试资料答案R23 Mergers and Acquisitions - Answers.pdf

Question #1 of 102 Question ID: 1209477 Froogal Inc. operates in an industry where the current Herndahl-Hirschman Index (HHI) is at 1,500. The company is considering merging with a competitor that would increase the HHI by 75. Is the merger likely to attract anti-trust action? A) Yes, because the industry pre-merger is considered highly concentrated and the change in HHI is greater than 50. B) Not enough information about the number of competitors. C) No, because the industry pre-merger is considered moderately concentrated and the change 7 3 in the HHI is less than 100. 2 1 q i Explanation s u If the post-merger HHI is less than 1,000, the industry is considered competitive and an antitrust m challenge is unlikely. A post-merger HHI value between 1,000 and 1,800 will place the industry in the : t moderately concentrated category