Categorize each of the following examples as a horizontal, vertical, or conglomerate merger. Horizontal Vertical Conglomerate A shoe manufacturer merges with a media and entertainment corporation. A newspaper publisher merges with a paper and pulp mill. In 1998, two car manufacturers, one in Germany and one in the United States, merged to form a single company.

Categorize each of the following examples as a horizontal, vertical, or conglomerate merger. Horizontal Vertical Conglomerate A shoe manufacturer merges with a media and entertainment corporation. A newspaper publisher merges with a paper and pulp mill. In 1998, two car manufacturers, one in Germany and one in the United States, merged to form a single company.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter15: Oligopoly And Strategic Behavior

Section: Chapter Questions

Problem 13P

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With an estimated market share of 60%, Atlas is the dominant company and the price leader in an oligopolistic steel industry. The remaining market share is distributed equally between ten companies. Suppose that one of those ten companies, Norton, attempts to gain market share by undercutting the price set by Atlas.Calculate the “Four Firm Ratio” and Herfindahl-Hirschman Index “HHI” in the above described market and interpret your answer. What model can best resemble this market? Briefly explain this model. In your opinion, what will be the effect of Norton’s attempt described above on Atlas’s market share: will it increase, decrease, or not affected at all? Justify your answer
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