The aim of antitrust policy is to:
a. provide adequate incentives for inventors and entrepreneurs.
b. prevent firms from acquiring or exercising undue market power.
c. protect established firms by deterring new entry into industries.
d. regulate the prices charged by perfectly competitive firms.
b
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The Herfindahl-Hirschman Index measures market concentration in an industry by summing the square of the percentage market shares for
A) the 4 largest firms. B) the 50 smallest firms. C) the 4 smallest firms. D) the 50 largest firms. E) all firms in the market.
What are the substitution effects that affect aggregate demand?
What will be an ideal response?
A person starting to drive more recklessly after signing a contract with an automobile insurance company is an example of
A) adverse selection. B) moral hazard. C) signaling. D) screening.
Which of the following statements explains the vicious circle of poverty?
a. By investing in education and infrastructure at the same time, the country can overcome the problems of poverty. b. Poverty arises out of the lack of investment, but countries cannot invest because they are poor. c. A nation can shift its production possibilities curve inward by shifting more resources into the production of capital goods. d. A nation can shift its production possibilities curve outward by shifting more resources into the production of consumer goods. e. There are dual economies in the world: Some are meant to be rich and others are meant to be poor.