Which of the following statements is true?
A. A vertical merger is a merger of firms that compete in the same market.
B. The rule of reason doctrine declares that the existence of monopoly alone is illegal.
C. Government regulation is economically justifiable for a natural monopoly.
D. Deficient information on unsafe products causes underconsumption.
Answer: C
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If a country begins to import more of a commodity, one can normally expect the price of the commodity to
a. remain unchanged in that nation. b. rise and then fall below where it was originally. c. rise in that nation. d. drop in that nation.
A survey of income by county revealed that four of the five wealthiest counties were located in the suburbs surrounding Washington, D.C. Why?
The choice of a voter to remain uninformed because the marginal cost of obtaining information is greater than the marginal benefit from obtaining knowledge is called:
A. irrational ignorance. B. rational ignorance. C. collective interest. D. choice.
The fact that most medical care purchases are financed through insurance:
A. has no effect on health care consumption because aggregate costs are the same regardless of payment method. B. reduces the amount of health care consumed by raising the price of additional units of care. C. has decreased health care costs and therefore reduced aggregate health care expenditures. D. increases the amount of health care consumed by reducing the price of additional units of care.