Question 1

A successful application of the Sherman Antitrust Act was in _______ against _______.

Accepted Answer

A)  1880; the Ford Motor Company 
B)  1889; the American Tobacco Company 
C)  1911; Standard Oil 
D)  B and C are true. 
A)  1880; the Ford Motor Company 
B)  1889; the American Tobacco Company 
C)  1911; Standard Oil 
D)  B and C are true.

Question 2

The government is most likely to challenge a merger that:

Accepted Answer

A)  is of the vertical type. 
B)  is of the conglomerate type. 
C)  results in a substantial lessening of competition, regardless of its type. 
D)  results in any lessening of competition. 
A)  is of the vertical type. 
B)  is of the conglomerate type. 
C)  results in a substantial lessening of competition, regardless of its type. 
D)  results in any lessening of competition.

Question 3

Regulatory agencies attempt to:

Accepted Answer

A)  limit the degree of competition between firms. 
B)  influence business decisions that affect consumer and worker safety. 
C)  guide businesses into the most profitable channels. 
D)  establish tariffs and quotas against foreign firms. 
A)  limit the degree of competition between firms. 
B)  influence business decisions that affect consumer and worker safety. 
C)  guide businesses into the most profitable channels. 
D)  establish tariffs and quotas against foreign firms.

Question 4

Selling below cost by foreign firms is called:

Accepted Answer

A)  dumping. 
B)  undercutting. 
C)  unfair competition and is punishable under the Clayton Act. 
D)  unpatriotic. 
A)  dumping. 
B)  undercutting. 
C)  unfair competition and is punishable under the Clayton Act. 
D)  unpatriotic.

Question 5

An action considered to be illegal only after considering the circumstances surrounding it is said to be illegal per se.

Accepted Answer

A) True 
 B)False

Question 6

High cross price elasticity of demand is an indication that two goods should be included in the same market when attempting to assess concentration.

Accepted Answer

A) True 
 B)False

Question 7

A firm's acquisition of assets of a competitor which results in decreased competition is subject to prosecution under the Clayton Act.

Accepted Answer

A) True 
 B)False

Question 8

Situations where whether or not a particular business practice is illegal depends on the circumstances surrounding the action are said to be subject to:

Accepted Answer

A)  the rule of reason. 
B)  an unfair constraint. 
C)  monopolistic behavior. 
D)  oligopolistic behavior. 
A)  the rule of reason. 
B)  an unfair constraint. 
C)  monopolistic behavior. 
D)  oligopolistic behavior.

Question 9

The Federal Communications Commission regulates:

Accepted Answer

A)  sales of securities, such as stocks. 
B)  food, drugs, and cosmetics. 
C)  broadcasting and telecommunications. 
D)  business practices. 
A)  sales of securities, such as stocks. 
B)  food, drugs, and cosmetics. 
C)  broadcasting and telecommunications. 
D)  business practices.

Question 10

A result of airline deregulation was that:

Accepted Answer

A)  fares increased. 
B)  safety worsened. 
C)  competition increased. 
D)  productivity, output, and efficiency decreased. 
A)  fares increased. 
B)  safety worsened. 
C)  competition increased. 
D)  productivity, output, and efficiency decreased.

Question 11

When two or more firms combine or conspire to monopolize trade, they are most directly in violation of the:

Accepted Answer

A)  Clayton Act. 
B)  Sherman Antitrust Act. 
C)  Federal Trade Commission Act. 
D)  Celler-Kefauver Act. 
A)  Clayton Act. 
B)  Sherman Antitrust Act. 
C)  Federal Trade Commission Act. 
D)  Celler-Kefauver Act.

Question 12

The actions of regulatory agencies that promote the interests of government employees over those of the public can be explained, in part, by the:

Accepted Answer

A)  theory of public finance. 
B)  public choice theory of regulation. 
C)  capture theory of regulation. 
D)  theory of market failure. 
A)  theory of public finance. 
B)  public choice theory of regulation. 
C)  capture theory of regulation. 
D)  theory of market failure.

Question 13

The rule of reason as it applied to antitrust enforcement was not used in the ALCOA Case.

Accepted Answer

A) True 
 B)False

Question 14

Justice Department guidelines stipulate that proposed mergers that result in a postmerger HHI between 1,000 and 2,500 will be challenged if they increase the HHI by more than _______ points.

Accepted Answer

A)  100 
B)  75 
C)  50 
D)  25 
A)  100 
B)  75 
C)  50 
D)  25

Question 15

Airline deregulation has been unquestionably bad for consumers and the industry.

Accepted Answer

A) True 
 B)False

Question 16

The public choice theory of regulation assumes that regulations primarily serve the interests of consumers by restricting harmful actions of business firms.

Accepted Answer

A) True 
 B)False

Question 17

The public interest theory of regulation holds that a regulatory agency:

Accepted Answer

A)  acts as the decision-making head of the industry it regulates. 
B)  encourages other regulatory agencies to deregulate their industries. 
C)  seeks to find market solutions that are economically efficient. 
D)  extends its regulatory powers over industries it was not intended to regulate. 
A)  acts as the decision-making head of the industry it regulates. 
B)  encourages other regulatory agencies to deregulate their industries. 
C)  seeks to find market solutions that are economically efficient. 
D)  extends its regulatory powers over industries it was not intended to regulate.

Question 18

The _______ Act blocked _______ mergers where a(n) _______ in competition could be shown.

Accepted Answer

A)  Clayton; horizontal; change 
B)  Celler-Kefauver; vertical; reduction 
C)  FTC; all; increase 
D)  Robinson-Patman; vertical; reduction 
A)  Clayton; horizontal; change 
B)  Celler-Kefauver; vertical; reduction 
C)  FTC; all; increase 
D)  Robinson-Patman; vertical; reduction

Question 19

Antitrust policy refers to government:

Accepted Answer

A)  attempts to prevent the acquisition of monopoly power. 
B)  attempts to encourage the exercise of monopoly power. 
C)  encouragement of collusion in the marketplace. 
D)  attempts to limit private enterprise. 
A)  attempts to prevent the acquisition of monopoly power. 
B)  attempts to encourage the exercise of monopoly power. 
C)  encouragement of collusion in the marketplace. 
D)  attempts to limit private enterprise.

Question 20

Describe the major features of and the importance of the:
a.Sherman Antitrust Act
b.Clayton Act
c.Federal Trade Commission Act.

Accepted Answer

a. Sherman Antitrust Act:
The Sherman An

A successful application of the Sherman Antitrust Act was in _ against _.

The government is most likely to challenge a merger that:

Regulatory agencies attempt to:

Selling below cost by foreign firms is called:

An action considered to be illegal only after considering the circumstances surrounding it is said to be illegal per se.

High cross price elasticity of demand is an indication that two goods should be included in the same market when attempting to assess concentration.

A firm's acquisition of assets of a competitor which results in decreased competition is subject to prosecution under the Clayton Act.

Situations where whether or not a particular business practice is illegal depends on the circumstances surrounding the action are said to be subject to:

The Federal Communications Commission regulates:

A result of airline deregulation was that:

When two or more firms combine or conspire to monopolize trade, they are most directly in violation of the:

The actions of regulatory agencies that promote the interests of government employees over those of the public can be explained, in part, by the:

The rule of reason as it applied to antitrust enforcement was not used in the ALCOA Case.

Justice Department guidelines stipulate that proposed mergers that result in a postmerger HHI between 1,000 and 2,500 will be challenged if they increase the HHI by more than _______ points.

Airline deregulation has been unquestionably bad for consumers and the industry.

The public choice theory of regulation assumes that regulations primarily serve the interests of consumers by restricting harmful actions of business firms.

The public interest theory of regulation holds that a regulatory agency:

The ___ Act blocked _ mergers where a(n) _____ in competition could be shown.

Antitrust policy refers to government:

Describe the major features of and the importance of the: a.Sherman Antitrust Act b.Clayton Act c.Federal Trade Commission Act.

Economics: The Study of Choice

Confronting Scarcity: Choices in Production

Demand and Supply

Applications of Supply and Demand

Elasticity: a Measure of Response

Markets, Maximizers, and Efficiency

The Analysis of Consumer Choice

Production and Cost

Competitive Markets for Goods and Services

Monopoly

The World of Imperfect Competition

Wages and Employment in Perfect Competition

Interest Rates and the Markets for Capital and Natural Resources

Imperfectly Competitive Markets for Factors of Production

Public Finance and Public Choice

International Trade

The Economics of the Environment

Inequality, Poverty, and Discrimination

Filters

Exam 16: Antitrust Policy and Business Regulation

A successful application of the Sherman Antitrust Act was in _______ against _______.

The government is most likely to challenge a merger that:

Regulatory agencies attempt to:

Selling below cost by foreign firms is called:

An action considered to be illegal only after considering the circumstances surrounding it is said to be illegal per se.

High cross price elasticity of demand is an indication that two goods should be included in the same market when attempting to assess concentration.

A firm's acquisition of assets of a competitor which results in decreased competition is subject to prosecution under the Clayton Act.

Situations where whether or not a particular business practice is illegal depends on the circumstances surrounding the action are said to be subject to:

The Federal Communications Commission regulates:

A result of airline deregulation was that:

When two or more firms combine or conspire to monopolize trade, they are most directly in violation of the:

The actions of regulatory agencies that promote the interests of government employees over those of the public can be explained, in part, by the:

The rule of reason as it applied to antitrust enforcement was not used in the ALCOA Case.

Justice Department guidelines stipulate that proposed mergers that result in a postmerger HHI between 1,000 and 2,500 will be challenged if they increase the HHI by more than _______ points.

Airline deregulation has been unquestionably bad for consumers and the industry.

The public choice theory of regulation assumes that regulations primarily serve the interests of consumers by restricting harmful actions of business firms.

The public interest theory of regulation holds that a regulatory agency:

The _______ Act blocked _______ mergers where a(n) _______ in competition could be shown.

Antitrust policy refers to government:

Describe the major features of and the importance of the: a.Sherman Antitrust Act b.Clayton Act c.Federal Trade Commission Act.

Economics: The Study of Choice

Confronting Scarcity: Choices in Production

Demand and Supply

Applications of Supply and Demand

Elasticity: a Measure of Response

Markets, Maximizers, and Efficiency

The Analysis of Consumer Choice

Production and Cost

Competitive Markets for Goods and Services

Monopoly

The World of Imperfect Competition

Wages and Employment in Perfect Competition

Interest Rates and the Markets for Capital and Natural Resources

Imperfectly Competitive Markets for Factors of Production

Public Finance and Public Choice

International Trade

The Economics of the Environment

Inequality, Poverty, and Discrimination

Filters

A successful application of the Sherman Antitrust Act was in _ against _.

The ___ Act blocked _ mergers where a(n) _____ in competition could be shown.