Barclay Role of Govt in a Mkt Econ

The Clayton Anti-trust Act 

• was opposed by labor unions
• outlawed price discrimination
• never went into effect
• defended monompolies

Indirectly, the government has improved the quality of information available to consumers through

• the SEC
• its support of the internet
• requiring content labels on food products
• Federal Reserve system

Mergers and acquisitions might result in 

• more competition
• inadequate competition
• increases in consumer demand
• smaller companies

When a major car company lowers its prices, other car makers will probably

• maintain existing prices
• lower their prices
• go out of business
• raise their prices

Perfect competition is characterized by all of the following EXCEPT

• a large number of buyers and sellers
• well-informed buyers and sellers
• sellers acting together to set prices
• identical products

A monopoly that is based on the ownership or control of a manufacturing method, process, or other scientific advance is a 

• technological monopoly
• government monopoly
• natural monopoly
• geographic monopoly

A decrease in competition within an industry can result in

• lower prices
• more efficient resource allocation
• increased output
• a firm wielding economic and political  power

The Sherman Anti-trust Act 

• outlawed restraints and monopolies that hindered trade
• applied only to banking
• established the FDA
• nationalized the railroads

The government is involved in the U. S. economy for all of the following reasons EXCEPT to

• promote and encourage competiton
• prevent monopolies that deny the public the benefits of competition
• regulate industries in which a monopoly is in the public interest
• promote the development of market externalities

Under perfect competiton,

• products are similar but not identical
• numerous restrictions prevent firms from entering the market
• no seller sells a product above the prevailing market price
• a single seller can affect price