I just need help with #26 and also to check if the other ones are right or wrong
ID: 1114029 • Letter: I
Question
I just need help with #26 and also to check if the other ones are right or wrong.to a perfectly competitive market with similar cost conditions, a monopolist will have AJa lower output and a higher price. B] a higher output and higher price [C] a higher output and a lower price D] a lower output and lower price. 24. Antitrust policy is the term used to describe government policies and programs designed to IA] deal with the threat of competitive practices to the public interest B) promote the creation of trusts, or combinations of independent firms. © create an environment in which firms will trust the government. control the growth of monopolies and enhance competition. 25. What part of the federal government is charged with promoting competion and regulating monopolies? AD the Federal Trade Commission (FTC). B] Congress C] the Interstate Trade Commission (ITC). D] the Department of Industry. Trade and Commerce. Use the following to answer questions # 26-27 Percentage of Sales in the Market Company ABC DEF GHI JKL MNO 30 15 35 15 26. What is the three-firm concentration of this industry? [A] 100%. [B] 95%. [C] 80% [DI 65% 27. What is the Herfindahl-Hirschman index for this industry? A] 100 B] 200 12,600 D] 10,000
Explanation / Answer
Ans)
23.
A. a lower output and a higher price
A monopolist produces where marginal cost equal marginal revenue, this output level is lower than that of perfect competition.It charges a price where a vertical line from MC equals MR,which is higher than that of perfect competition.
24.
D. control the growth of monopolies and enhance competition
Anti-trust laws were designed to control monopolies and promote competition and fair trade practices.One of the most important Act is the Sherman Act of 1890.
25.
A. The federal trade commission(FTC)
The federal trade commission is an independant agency which was responsible for consumer protection and for anticompetitive practices.
26.
C. 80%
Three firm concentration ratio=(35+30+15)=80%