All else being equal, if the diversion ratio between the products of two companies is high, then a merger will tend to increase prices and if the diversion ratio is low, the price impact will tend to be small. Because the automaker needs to recover the costs of manufacturing, high steel costs lead to higher car prices, but do not influence how many cars people want to buy.[6] Put differently, steel prices influence how much a manufacturer wants to sell each car for (i.e., the supply curve), but not how much a consumer is willing to pay for a car (i.e., the demand curve).[7] The price of steel can be used as an "instrument" for the price of a car. This potential price impact can be calculated via the gross upward price pressure index (GUPPI), which is the product of diversion ratios and price-cost margins. However, it was the higher costs of operation (and thus higher prices) that caused fewer firms to enter high-cost markets, leading to greater concentration. [Extracted from the article]