U.S. manufacturers formed trusts in the late 1880s because
a. booms in the economy made trusts highly profitable and allowed them to expand
b. economies of scale allowed larger firms to prosper
c. the rapid growth of the railroads allowed firms to reach a wider market
d. technological breakthroughs increased capital use and optimal firm size
e. they wanted to avoid price wars during depressions
E
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Which of the following is NOT true of an insolvent bank?
A) Its net worth is negative. B) It may be unable to pay off its depositors. C) The value of its assets is less than the value of its liabilities. D) It must have no more deposits.
Refer to Figure 10.7. A movement from point A to point B could be caused by
A) a negative demand shock. B) a decrease in the term premium investors expect in the future. C) an increase in the default-risk premium. D) an increase in the expected rate of inflation.
The supply-determined nature of output and employment is a crucial feature of
a. the Keynesian theory. b. the classical system. c. monetarism. d. the rational expectations model.
Refer to the above graph of the representative firm in monopolistic competition. Point c is the intersection of the:
A. marginal cost and average total cost curves. B. average total cost and demand curves. C. marginal cost and demand curves. D. marginal cost and marginal revenue curves.