Multiple Choice Identiy the choice that best comypletes the statement or answers
ID: 1165633 • Letter: M
Question
Multiple Choice Identiy the choice that best comypletes the statement or answers the question 1. Which of the following is true of Antitrust policy a. Antitust policy prohibits agreements that allow free trade b. Antitrust policy restricts abusive behavior by a firm dominating a market e. Antitrust policy allows anti-competitive practices. d. Antitrust policy encourages establishment of monopoly firms e. Antitrust policy creates trade barriers like tariffs and quota 2. Which of the following are the three laws that define the U.S government's approach to antitrust? The Springfield, Clayton, and Trade Commission Acts The Sherman, Clayton, and Federal Trade Commission Acts The Sherman, Jackson, and Regional Trade Commissions Acts The Jackson, Charleston and Sherman Monopoly Restrictive Trade Acts b. · d. e. 3. The antitrust laws in the United States were created in the late 1800s as a result of: the emergence of large and dominant businesses in railroads, steel, oil, mining and finance the government decision to take responsibility for the improvement of trade deficit. the first illegal cartel, created in late 1800s. a. b. c. d a steep decline in prices of primary goods in the United States e. the United States being threatened by an external aggression. 4. A market is said to be concentrated when: a. b. c. d. e. the degree of competition in the market increases. many firms supply to a small number of consumers. the firms producing identical goods are clustered in a particular location. a firm or a few firms are able to dictate the competitive conditions in a market. there is a huge immigration of workers from neighboring areas. 5. The most reliable measure of market concentration is: a. the Cost of Living index. b. the Herfindahl index. c. the Market index d. the Market-Value weighted index. e. the Wholesale Price index The judicial doctrine, being a monopoly or attempting to monopolize is not in itself illegal; to be illegal, an action had to be shown to have negative economic effects, is called a. the "big is bad" policy. b. the per se rule. c. predatory price-cutting policy d. the rule of law. e. the rule of reason. 6.Explanation / Answer
1.b.antitrust policy restricts abusive behaviour by a firm dominating a market.
The above statement is true about the antitrust policy also, it encourages fair market practices by discouraging monopoly and encouraging competition.
2.The Sherman, Clayton, and Federal Trade Commissions Act
3. The emergence of large and dominant businesses in railroads, steel, oil, mining, and finance
4. D. A firm or a few firms are able to dictate the competitive conditions in the market.
5. B. The herfindahl index.
It is calculated by squaring the market share of each firm competing in a market and then adding the resulting numbers.
6. e. the rule of reason
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