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astra-53 [7]
3 years ago
15

Suppose two companies attempt to merge, and they operate in an industry where the postmerger Herfindahl-Hirschman index is 2,900

and the increase in the Herfindahl-Hirschman index from the merger is 225.
Which of the following is NOT a condition that would improve the likelihood of the Justice Department approving the merger?

a. The HHIs are based on too narrow a definition of the product market.
b. There are significant diseconomies of scope.
c. One of the firms is in financial trouble.
d. There are significant economies of scale.
e. There is notable foreign competition.
Business
2 answers:
STatiana [176]3 years ago
8 0

Answer: C

Explanation:

According to the United States Department of Justice a market with an HHI of 2,500 or greater is considered a highly concentrated marketplace. The general rule states that a merger which increases the HHI by more than 200 points in highly concentrated markets raise trust issues and concerns, which in this case the increase of 225 after the merger would raise concerns, this also means the Market is competitive

Allushta [10]3 years ago
6 0

Answer:

Option B -  There are significant diseconomies of scope is the correct answer.

Explanation:

Option  A is, not a condition that could improve the probability that the justice department would approve the merger.

The Herfindahl-Hirschman index is based on a restricted definition of the product market or the impact of foreign competition, the merger might be allowed.

It might also be permitted if one of the firms is in financial trouble, or if significant economies of scale exist in the industry.

Significant diseconomies of scope would only serve to make the merger less likely to be accepted.

Therefore, option B is the correct answer.

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To avoid potential liability for misconduct in corporate operations, directors can refrain from reasonable supervision of work d
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c. corporate officers.

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A static budget shows planned results at the original budgeted activity level. should not be prepared in a company. is useful in
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Answer:

The answer about A static budget would be

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3 years ago
Harper Chicken Corporation processes and packages chicken for grocery stores. It purchases chickens from farmers and processes t
mrs_skeptik [129]

Answer:

a1)

drumstink  3,780

breast        5,670

a2)

drumstink  (280)

breast       3,570

a3) it cannot be eliminated as it is a subproduct of the breast we cannot produce breast without also, produing the drumstink

b) joint-cost and gross margin considering market value as wat to allocate joint-cost

drumstink  2.596,15

breast  .853,85

gross margin

drumstink 903.85

breast    2,386.15

<em>Questions:</em>

a-1. Allocate the joint cost to the joint products, drumsticks and breasts, using weight as the allocation base.

a-2. Calculate the gross margin for each product.

a-3. If the drumsticks are producing a loss, should that product line be eliminated?

b-1. Reallocate the joint cost to the joint products, drumsticks and breasts, using relative market values as the allocation base.

b-2. Calculate the gross profit for each product.

Explanation:

cost for the joint process:

7,000 raw materials + 2,450 conversion cost = 9,450

weights: 2,800 drumstiks  

           <u>   4,200 breast         </u>

total       7,000

drumstink 9,450 x 2,800/7,000  = 3780

breast  9,450 x 4,200/7,000  = 5670

gross margin

drumstink 2,800 * 1.25  - 3,780=  (280)

breast 4,200 * 2.20  - 5,670 =     3,570

<em>using market value as weight:</em>

drumstink 2,800 * 1.25  =  3,500

breast 4,200 * 2.20       = <u> 9,240 </u>

total sales value                12,740

drumstink 9,450 x 3,500/12,740  = 2.596,15

breast  9,450 x 9,240/12,740  = 6.853,85

gross margin

drumstink 3,500  - 2,596.15 = 903.85

breast 9,240  - 6,853.85 =   2,386.15

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