Answer the following statements true (T) or false (F)

1. The rule of reason states that monopolies that behave well are still illegal.
2. Advertising is considered a form of product differentiation.
3. Oligopolies always produce differentiated products.
4. Price stability is common in oligopolies.
5. Perfect competition always provides a lower price than monopolistic competition or an oligopoly.
6. The Clayton Act prohibits price discrimination, if it substantially reduces competition.
7. A four-firm concentration ratio indicates the number of firms in the industry.
8. The Herfindahl Index is calculated by summing the squares of the market shares of each firm in the industry.


1. FALSE
2. TRUE
3. FALSE
4. TRUE
5. FALSE
6. TRUE
7. FALSE
8. TRUE

Economics

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