One way in which antitrust law fosters economic efficiency is by
a. defining property rights for firms
b. encouraging voluntary trade
c. prohibiting firms from colluding to raise prices
d. enforcing contracts between firms
e. encouraging mergers that increase market power
C
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Which of the following is a direct implication of the view that childbearing is an economic decision?
(a) People will not have additional children unless they can earn a profit from doing so. (b) Social factors have no effect on childbearing decisions. (c) Compulsory education will increase fertility because educated children have the potential to earn higher salaries. (d) Fertility should fall with improved opportunities for women to work in jobs outside the home.
Which of the following is true?
a. Competitive forces are stronger in markets with high entry barriers than in those where entry barriers are low. b. Quality competition is an important element of the competitive process. c. If the production of a good is highly profitable, the development of substitute products will be discouraged. d. High barriers to entry are only the result of natural factors not artificial factors like government regulations.
What will cause a decrease in US AD?
a. an increase in interest rates b. a boost in consumer confidence c. a decrease in business material costs d. an increase in M1 and M2
If the Federal government enacts a new excise tax of $1.50 per case of soda. Which of the following is most likely to occur?
a. Consumers of soda will pay a higher price and buy a larger quantity. b. Consumers of soda will pay a higher price, which will increase the profits of soda companies, inducing them to sell a larger quantity. c. Consumers of soda will pay a higher price and buy a smaller quantity. d. Consumers of soda will buy less bottled water.