The "rule of reason" indicated that:
A. if less than four firms account for three-fourths of an industry's sales, the industry is in
violation of the Sherman Act.
B. social regulation should not be enforced unreasonably so that costs exceed benefits.
C. the mere possession of monopoly power is a violation of the antitrust laws.
D. only contracts and combinations that unreasonably restrain trade violate the antitrust laws.
Answer: D
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A ________ between price and quantity sold because ________
A) monopoly faces a tradeoff; to sell a larger quantity, it must lower its price B) monopoly does not face a tradeoff; it controls market entry and can sell at any price and any quantity C) natural monopoly faces a tradeoff; it can always price discriminate D) natural monopoly does not face a tradeoff; it is a price maker E) perfectly competitive firm faces a tradeoff; it is a price taker
One way to minimize the excess burden resulting from a specific tax is to:
a. tax only wealthy firms and individuals. b. spread the tax over many goods and services. c. tax goods for which either supply or demand is inelastic. d. tax luxury items such as yachts and sports cars.