Question 1

Which of the following made monopoly and restraints of trade criminal offenses against the federal government?

Accepted Answer

A)   Celler-Kefauver Act of 1950
B)   Wheeler-Lea Act of 1938
C)   Clayton Act of 1914
D)   Sherman Act of 1890E) A) and B)
F) A) and C)

Question 2

Which of the following is characteristic of a regulated natural monopoly?

Accepted Answer

A)   extensive economies of scale
B)   the wasteful duplication of capital facilities in the event of competition
C)   the provision of an essential service
D)   all of theseE) B) and D)
F) B) and C)

Question 3

A merger between an automobile manufacturer and a maker of automobile tires is an example of a

Accepted Answer

A)   conglomerate merger.
B)   horizontal merger.
C)   vertical merger.
D)   tying contract.E) A) and B)
F) C) and D)

Question 4

Which of the following is a per se violation?

Accepted Answer

A)   price discrimination
B)   price-fixing
C)   extremely high Herfindahl index
D)   horizontal mergerE) B) and C)
F) A) and B)

Question 5

The optimal amount of social regulation occurs where the marginal benefit of such regulation

Accepted Answer

A)   equals the marginal cost.
B)   exceeds the marginal cost by the greatest amount.
C)   is zero.
D)   is at its maximum.E) A) and B)
F) All of the above

Question 6

Which of the following gave the Federal Trade Commission and the U.S. Justice Department the responsibility to enforce antitrust laws?

Accepted Answer

A)   the Sherman Act
B)   the Wheeler-Lea Act
C)   the Clayton Act
D)   the Federal Trade Commission ActE) B) and D)
F) C) and D)

Question 7

Restructuring of a major industry resulted from the

Accepted Answer

A)   U.S. Steel case.
B)   AT&T case.
C)   IBM case.
D)   DuPont cellophane case.E) A) and C)
F) None of the above

Question 8

The cornerstone of antitrust legislation in the U.S. is the

Accepted Answer

A)   Clayton Act.
B)   Sherman Act.
C)   Celler-Kefauver Act.
D)   Federal Trade Commission Act.E) A) and D)
F) C) and D)

Question 9

Differences in the application of antitrust laws are in part rooted on the issue of how broadly antitrust authorities should define the relevant

Accepted Answer

A)   market.
B)   product.
C)   price.
D)   firm.E) B) and D)
F) A) and C)

Question 10

Which business practice is rarely challenged by the government under antitrust laws?

Accepted Answer

A)   price-fixing
B)   tying contracts
C)   price discrimination
D)   interlocking directoratesE) A) and B)
F) All of the above

Question 11

Most economists agree that deregulation in the 1970s and 1980s greatly benefited consumers in all of the following industries except

Accepted Answer

A)   automotive.
B)   railroads.
C)   airlines.
D)   trucking.E) C) and D)
F) A) and B)

Question 12

The government and courts have not been consistent in interpreting and enforcing antitrust laws over the years.

Accepted Answer

A) True 
 B)False

Question 13

Interlocking directorates are

Accepted Answer

A)   legal if the two firms have small market shares.
B)   illegal under provisions of the Federal Trade Commission Act of 1914.
C)   illegal under provisions of the Celler-Kefauver Act of 1950.
D)   illegal under provisions of the Clayton Act of 1914.E) A) and B)
F) B) and D)

Question 14

A merger of several firms operating in different industries-for example, a trucking company, a fast-food chain, and a brokerage house-is called

Accepted Answer

A)   an integrated merger.
B)   a conglomerate merger.
C)   a vertical merger.
D)   a horizontal merger.E) A) and B)
F) A) and C)

Question 15

Government regulation concerning the conditions under which goods are produced, the impact of production on society, and the physical qualities of the goods is known as

Accepted Answer

A)   industrial regulation.
B)   social regulation.
C)   economic regulation.
D)   antitrust regulation.E) B) and D)
F) A) and C)

Question 16

Social regulation

Accepted Answer

A)   was developed as a substitute for industrial regulation.
B)   has declined in importance in recent years.
C)   applies more broadly and affects more people than industrial regulation.
D)   is more concerned with the overall standard of living of society rather than with details of production processes.E) A) and C)
F) None of the above

Question 17

The general conclusion of most economists about deregulation of previously regulated industries in the United States is that it resulted in

Accepted Answer

A)   increased monopoly power.
B)   lower rates of innovation.
C)   increased bureaucratic control.
D)   decreased prices of goods and services.E) None of the above
F) A) and B)

Question 18

A conglomerate merger is a merger between firms at different stages of the production process of a product, such as a merger between a flour milling company and a baking company.

Accepted Answer

A) True 
 B)False

Question 19

Which one of the following is not correct?

Accepted Answer

A)   In antitrust cases defendants attempt to define the relevant market broadly.
B)   The courts have varied over time in their interpretations of the antitrust statutes.
C)   Antitrust suits can be originated only by the Federal Trade Commission.
D)   In antitrust cases the prosecution attempts to define the relevant market narrowly.E) A) and C)
F) A) and B)

Question 20

The Occupational Safety and Health Administration is mainly involved in

Accepted Answer

A)   industrial regulation.
B)   social regulation.
C)   antitrust regulation.
D)   public utility regulation.E) A) and D)
F) A) and C)

Exam 21: Antitrust Policy and Regulation

Government regulation concerning the conditions under which goods are produced, the impact of production on society, and the physical qualities of the goods is known as

Correct AnswerverifiedShow Answer

Restructuring of a major industry resulted from the

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Which of the following is characteristic of a regulated natural monopoly?

Correct AnswerverifiedShow Answer

Which business practice is rarely challenged by the government under antitrust laws?

Correct AnswerverifiedShow Answer

Which of the following made monopoly and restraints of trade criminal offenses against the federal government?

Correct AnswerverifiedShow Answer

Which one of the following is not correct?

Correct AnswerverifiedShow Answer

The general conclusion of most economists about deregulation of previously regulated industries in the United States is that it resulted in

Correct AnswerverifiedShow Answer

Differences in the application of antitrust laws are in part rooted on the issue of how broadly antitrust authorities should define the relevant

Correct AnswerverifiedShow Answer

Interlocking directorates are

Correct AnswerverifiedShow Answer

Which of the following is a per se violation?

Correct AnswerverifiedShow Answer

Most economists agree that deregulation in the 1970s and 1980s greatly benefited consumers in all of the following industries except

Correct AnswerverifiedShow Answer

The Occupational Safety and Health Administration is mainly involved in

Correct AnswerverifiedShow Answer

Which of the following gave the Federal Trade Commission and the U.S. Justice Department the responsibility to enforce antitrust laws?

Correct AnswerverifiedShow Answer

A conglomerate merger is a merger between firms at different stages of the production process of a product, such as a merger between a flour milling company and a baking company.

Correct AnswerverifiedShow Answer

The optimal amount of social regulation occurs where the marginal benefit of such regulation

Correct AnswerverifiedShow Answer

A merger of several firms operating in different industries-for example, a trucking company, a fast-food chain, and a brokerage house-is called

Correct AnswerverifiedShow Answer

A merger between an automobile manufacturer and a maker of automobile tires is an example of a

Correct AnswerverifiedShow Answer

Social regulation

Correct AnswerverifiedShow Answer

The cornerstone of antitrust legislation in the U.S. is the

Correct AnswerverifiedShow Answer

The government and courts have not been consistent in interpreting and enforcing antitrust laws over the years.

Correct AnswerverifiedShow Answer

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