ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
6th Edition
ISBN: 9781337408059
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 15, Problem 5P
a)
To determine
The anticompetitive behavior in the case: When the university wants the buyers of its season tickets for basketball games to buy season tickets for its football games also.
b)
To determine
The anticompetitive behavior in the case of: Collusion between increase in what the diaries charge and their bid on contracts to supply milk to school district.
To determine
The anticompetitive behavior in the case: when the same person serves as the board of directors of ford and general motors.
To determine
The anticompetitive behavior in the case: When in order to drive competitors out of the business a large retailer sells merchandise below the cost
To determine
The anticompetitive behavior in the case: When the producer agrees to sell the soft drinks to the retailer only if promises not to buy from the major competitors of the producers.
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(Origins of Antitrust Policy) Identify the type of anticompetitive behaviour illustrated by each of the following:
a. A university requires buyers of season tickets for its basketball games to buy season tickets for its football games as well.
b. Dairies that bid on contracts to supply milk to school districts collude to increase what they charge.
c. The same individual serves on the boards of directors of General Motors and Ford.
d. A large retailer sells merchandise below cost in certain regions to drive competitors out of business.
e. A producer of soft drinks sells to a retailer only if the retailer agrees not to buy from the producer's major competitor.
What is the primary objective of antitrust laws in the United States? A. Promoting mergers and acquisitions B. Encouraging market consolidation C. Preventing monopolistic behavior and promoting competition D. Regulating international trade
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Chapter 15 Solutions
ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
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- What is the goal of antitrust policies?arrow_forwardFor many years, the Justice Department has tried to break up large firms like IBM, Microsoft, and most recently Google, on the grounds that their large market share made them essentially monopolies. In a global market, where U.S. films compete with firms from other countries, would this policy make the same sense as it might in a purely domestic context?arrow_forwardHow do we measure a four-firm concentration ratio? What does a high measure mean about the extent of competition?arrow_forward
- In what sense is a natural monopoly natural?arrow_forward4. Analyze effectiveness of antitrust laws by noting how they have been applied to monopolies, mergers, and price fixing.arrow_forward2. THE PRICE OF POLITICAL PERSUASION: Uh, oh – there has been a lot of news lately about the government using antitrust law to rein in you and your social media empire. Hoping for more favorable treatment and a more profitable business environment, you invest in some lobbyists to represent your firm and communicate your perspectives to the nice lawmakers in Washington, DC. Your market researchers tell you that your monopoly faces a market demand curve of P[Q] = 200 – Q and that your total costs are TC[Q] = 80Q. а. Assuming that you are a profit-maximizing monopolist, compute P*, Q*, PS, CS and DWL. Draw the graph!arrow_forward
- Merger of beer giants faces obstacles Mega-brand beers have lost market share to wine and craft beer. In response, Anheuser-Busch InBev and SABMiller, the two biggest brewers in the world, are discussing a merger that would be scrutinized by antitrust regulators. Source: The New York Times, September 16, 2015 How would a merger benefit the two big brewers? Under what circumstances would the Federal Trade Commission (FTC) challenge the merger? A merger would benefit the two big brewers because O A. the price of beer would fall close to the price in a perfectly competitive market and sales would increase O B. average total cost would increase but price would increase by more than average total cost O C. the price of beer could rise close to the monopoly price and economic profit would increase O D. many craft brewers would be forced out of the market The Federal Trade Commission would challenge the merger if O A. it increases the HHI O B. the HHI is less than 1,500 O C. the HHI is…arrow_forward10. Questionable business practices according to antitrust agencies Complete the following table by matching each of the scenarios to the concept of resale price maintenance, predatory pricing, or bundling. Resale Price Maintenance Scenario RightRound sells a wide variety of records to retail record stores. RightRound recently pressed two new records: a popular pop punk album and a much less popular smooth jazz album. RightRound requires record stores to order 15 copies of the smooth Jazz album for every 140 copies of the pop punk album bought. Warm Winds is the only firm producing air fryers. It costs $460 to produce one air fryer, and Warm Winds sells each air fryer for $900. After Sirocco, a new firm with the same costs as Warm Winds, enters the market for air fryers, Warm Winds starts selling its air yers for a price of $330. RightRound is a firm that manufactures record players. Suppose RightRound sells its record players to online retailers for $342 each and requires those online…arrow_forward1. “Economics of Monopoly Power”Please respond to the following:From the first e-Activity, take a position on whether or not the current initiatives of the FCC encourage competition in all communication markets and protect the public. Provide specific examples to support your response.List and discuss three economic justifications for government regulation in your local area. Explain what happens if the government does not provide appropriate regulation. Determine the costs on society of government regulation.2. “Monopoly and Price Fixing”Please respond to the following:From the scenario, identify the possible illegal or unethical activities activities in which the print shop boss plans to engage in, and identify the consequences on society from an economic point of view. Explain whether or not you would have discussed these issues with the boss.From (1) a single product market perspective and (2) a natural monopolist market perspective, give your opinion on…arrow_forward
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