The Concentration and Herfindahl Indices Computed by the U

Multiple Choice

The concentration and Herfindahl indices computed by the U.S.Bureau of Census must be interpreted with caution because:

A) they overstate the actual level of concentration in markets served by foreign firms.
B) they understate the degree of concentration in local markets, such the gasoline market.
C) Both A and B are correct.
D) None of the statements are correct.