44) A key reason why regulators might approve a merger between competing compani

ID: 1164569 • Letter: 4

Question

44)

A key reason why regulators might approve a merger between competing companies is to encourage

(2pts)

vertical mergers

political campaign donations.

innovation.

price discrimination

tying contracts

45)

Of the different types of merger, the federal government looks at which one most carefully because of its potential for reducing competition?

(2pts)

vertical

diagonal

conglomerate

horizontal

staged

46)

Which of the following is a good example of a “network good”?

(2pts)

Electricity, because large economies of scale mean that the cost per kilowatt falls as more and more electricity is generated.

The telephone, because it becomes more useful as more and more people have telephones.

A television broadcast, because one person watching the show doesn’t prevent anyone else from watching the same show.

All the above.

None of the above.

35)

The two models that the PowerPoint slides use to represent the two possible extreme outcomes in oligopoly (zero profits or monopoly profits) are

(2pts)

price leadership and kinked demand curve

contestable market and prisoner’s dilemma

Bertrand duopoly and cartel

“per se” and Robinson-Patman

tacit collusion and Herfindahl

44. The correct answer is C.This will encourage innovation.

45. The correct answer should be C.

46. The correct answer is E.

35. The correct answer is A.

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