Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter13: Antitrust And Regulation
Section: Chapter Questions
Problem 7SQP
Related questions
Question
![How would you expect antitrust authorities to react to the following?
a. A proposed merger of Ford and General Motors.
O They would block this horizontal merger because it violates Section 7 of the Clayton Act.
O They would block this horizontal merger because it violates Section 1 of the Sherman Act.
O They would allow this horizontal merger unless both firms had very large market shares and the resultant merger would
substantially lessen competition.
b. Evidence of secret meetings by contractors to rig bids for highway construction projects.
O They would allow this.
O They would charge these firms with price-fixing, which violates Section 7 of the Clayton Act.
O They would charge these firms with price-fixing, which violates Section 1 of the Sherman Act.
C. A proposed merger of a large shoe manufacturer and a chain of retail shoe stores.
O They would block this merger because it violates Section 7 of the Clayton Act.
O They would block this merger because it violates Section 1 of the Sherman Act.
O They would allow this vertical merger unless both firms had very large market shares and the resultant merger would](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8ea3a059-0a8a-4779-bed8-ef5706e6b286%2F434f254a-9160-46cf-a25a-7a3e5878eb59%2Fx69n6z_processed.jpeg&w=3840&q=75)
Transcribed Image Text:How would you expect antitrust authorities to react to the following?
a. A proposed merger of Ford and General Motors.
O They would block this horizontal merger because it violates Section 7 of the Clayton Act.
O They would block this horizontal merger because it violates Section 1 of the Sherman Act.
O They would allow this horizontal merger unless both firms had very large market shares and the resultant merger would
substantially lessen competition.
b. Evidence of secret meetings by contractors to rig bids for highway construction projects.
O They would allow this.
O They would charge these firms with price-fixing, which violates Section 7 of the Clayton Act.
O They would charge these firms with price-fixing, which violates Section 1 of the Sherman Act.
C. A proposed merger of a large shoe manufacturer and a chain of retail shoe stores.
O They would block this merger because it violates Section 7 of the Clayton Act.
O They would block this merger because it violates Section 1 of the Sherman Act.
O They would allow this vertical merger unless both firms had very large market shares and the resultant merger would
![- A proposed merger of a large shoe manufacturer and a chain of retail shoe stores.
O They would block this merger because it violates Section 7 of the Clayton Act.
O They would block this merger because it violates Section 1 of the Sherman Act.
O They would allow this vertical merger unless both firms had very large market shares and the resultant merger would
substantially lessen competition.
d. A proposed merger of a small life-insurance company and a regional candy manufacturer.
O They would allow this conglomerate merger.
O They would block this conglomerate merger because it violates Section 7 of the Clayton Act.
O They would block this conglomerate merger because it violates Section 1 of the Sherman Act.
e. An automobile rental firm that charges higher rates for last-minute rentals than for rentals reserved weeks in advance.
O They would not interfere with this price discrimination.
O They would block this price discrimination because it violates Section 7 of the Clayton Act.
O They would block this price discrimination because it violates Section 1 of the Sherman Act.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8ea3a059-0a8a-4779-bed8-ef5706e6b286%2F434f254a-9160-46cf-a25a-7a3e5878eb59%2Ferpads_processed.jpeg&w=3840&q=75)
Transcribed Image Text:- A proposed merger of a large shoe manufacturer and a chain of retail shoe stores.
O They would block this merger because it violates Section 7 of the Clayton Act.
O They would block this merger because it violates Section 1 of the Sherman Act.
O They would allow this vertical merger unless both firms had very large market shares and the resultant merger would
substantially lessen competition.
d. A proposed merger of a small life-insurance company and a regional candy manufacturer.
O They would allow this conglomerate merger.
O They would block this conglomerate merger because it violates Section 7 of the Clayton Act.
O They would block this conglomerate merger because it violates Section 1 of the Sherman Act.
e. An automobile rental firm that charges higher rates for last-minute rentals than for rentals reserved weeks in advance.
O They would not interfere with this price discrimination.
O They would block this price discrimination because it violates Section 7 of the Clayton Act.
O They would block this price discrimination because it violates Section 1 of the Sherman Act.
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