(1) Which of the following mergers would most likely be challenged by the Federa
ID: 2439330 • Letter: #
Question
(1) Which of the following mergers would most likely be challenged by the Federal Trade Commission?:
A) two restaurants in a large metro area B) two largest wireless service providers in the U.S. wireless communication industry C) an automaker and an insurance company D) one oil refinery in the U.S. and another oil refinery in Canada
(2) The Supreme Court's decision in the Standard Oil of New Jersey case was:
A) to increase the fine imposed by a lower court. B) to force the company to send refund checks to customers. C) to break up the company. D) to force the company to pay $10 billion in fines.
(3)The Interstate Commerce Commission (ICC) regulates railroads, barges and trucks. Suppose technical change lowers the costs of railroads. As a result, the ICC permits railroads to lower prices some but also alters the rates of barges and trucks so they get additional business. The ICC would be acting consistently with:
A) the share-the-gains, share-the-pains theory of regulation. B) the capture theory of regulation. C) None of the theories presented in the text since economic regulation is specific to a single industry and not to agencies that cover more than one industry. That is the province of social regulation. D) the public interest theory of regulation.
Explanation / Answer
1)
Any merger that will compromise public interest, would most likely to be challenged by Federal Trade commission.
Wirelss communication industry provides essential services to people. Hence Merger may leads to higher prices.
Hence, right answer is (B)
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