Which two factors make regulating mergers complicated?
A) First, the Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice must both approve mergers. Second, the concentration ratios that are used to evaluate the degree of competition the merged firms face are flawed.
B) First, the time it takes to reach a decision to approve a merger is so long that the firms often have new owners and mangers. Second, by law, government officials are not allowed to consider the impact of foreign trade (exports and imports) on the degree of competition in the markets of the merged firms.
C) First, it is not always clear what market firms are in. Second, the newly merged firm might be more efficient than the merging firms were individually.
D) First, firms may lobby government officials to influence their decision to approve the merger. Second, by the time the government officials reach a decision regarding the merger, the firms often decide not to merge.
C
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When an emissions tax is imposed on production of a good, the price will be __________ than it would be in the absence of the tax, and the equilibrium quantity will be __________ :
a. higher, higher b. lower, lower c. lower, higher d. higher, lower
Economic theory asserts that an optimal decision is one that:
a. ignores implicit costs. b. ignores explicit costs. c. ignores the time frame in which costs and benefits are incurred. d. has chosen to undertake all of those activities that add to net gains.