Final answer:
The Herfindahl-Hirschman Index (HHI) of 2,100 falls under moderately concentrated markets, indicating a moderate level of market concentration.
Explanation:
The Herfindahl-Hirschman Index (HHI) for an industry is 2,100. This value falls under the category of moderately concentrated markets.
The HHI measures market concentration by summing the squares of the market shares of firms in the industry. Higher values indicate more concentrated markets, with perfect competition at 0 and a monopoly at 10,000.
For example, the HHI of 2,521 for breakfast cereals suggests higher concentration compared to ice cream with an HHI of 736, indicating the breakfast cereal industry is less competitive.
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