Suppose that you borrow $10,000 for one year, and at the end of the year, you must repay $10,350. The interest rate is

Suppose that two firms in an industry with a Herfindahl index of 5,000 announce a merger. The U.S. Justice Department concludes the merger will boost the index to 5,500. The antitrust authorities will most likely:

A. ignore this merger because of the relatively small increase in the Herfindahl index. B. allow the merger but watch the new firm carefully for future violations of the antitrust laws. C. allow the merger if foreign entry to the industry is possible. D. prevent the merger, contending that it violates the Clayton Act.

The law of diminishing marginal product is responsible for

A) economies of scale. B) constant returns to scale. C) diseconomies of scale. D) none of the long-run relationships.