Question

Which of the following is NOT a cause for the intervention of antitrust authorities?

a.

Companies abuse their market power by acquiring new firms that allow for the increase of prices above a level that would occur in a competitive market.

b.

The merger between two companies allows for several customer options and substantial competition within the industry.

c.

An acquisition that creates too much consolidation and increases the potential for future abuse of market power.

d.

A company cuts prices when a new competitor enters the industry to force the competitor out of business.

e.

Dominant companies use their market power to crush potential competitors.

Answer 1

b.

The merger between two companies allows for several customer options and substantial competition within the industry.

Step-by-step explanation:

Antitrust authorities will only come in if the merger was to remove competition and reduce consumer options.