Congress has divided the authority to police mergers between the Antitrust Division of the U.S. Department of Justice (AD) and the Federal Trade Commission (FTC). How is this authority divided?
A) The AD always renders its opinion on any proposed merger first. If the AD approves the merger, the case then goes to the FTC for final approval. If the AD disallows the merger, the decision stands and the FTC does not become involved.
B) Both the AD and the FTC are responsible for merger policy.
C) The AD establishes the guidelines that are used to evaluate proposed mergers; the FTC uses these guidelines to decide whether a proposed merger will be allowed to take place.
D) The AD decides whether proposed horizontal mergers will be challenged; the FTC decides whether proposed vertical mergers will be challenged.
B
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A sum of money received at a future date is worth less than the same sum of money received today. Why? Explain this with an example.
What will be an ideal response?
In the above figure, x is
A) positively related to y and negatively related to z. B) positively related to both y and z. C) negatively related to y and positively related to z. D) negatively related to both y and z.
In the nonlinear function Y = aXbZc , the parameter c measures
A. ?Y / ?Z B. the elasticity of Y with respect to Z. C. the percent change in Y for a 1 percent change in Z. D. both a and c E. both b and c
Robinson pays $100 for tickets to see his favorite sports team play. With 10 minutes left in the game, his team is losing heavily and has no chance of winning the game. Robinson chooses to stay until the end of the game because he wants to get the full value for his admission price. As an economist, you should advise Robinson to
A. leave the game if his marginal benefit of leaving is greater than marginal cost, as the admission price is a sunk cost. B. leave the game now as the line to exit the stadium is shorter now. C. stay until the end of the game as he might be heckled on the way out. D. stay until the end of the game as his intuition is correct.