It is necessary for government authorities such as the Federal Trade Commission (FTC) and/or the European Commission to approve any large horizontal integration activity because
A. the surviving firms will need to be protected against the increasing bargaining power of the suppliers.
B. the horizontal integration activity has the potential to reduce competitive intensity in an industry.
C. the horizontal integration activity changes the industry structure from oligopolistic to monopolistically competitive.
D. the surviving firms will need protection against the relaxed entry barriers.
Answer: B
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