Question: When one firm purchases another, it is called ________________.

1. an acquisition

2. B. antitrust violation

3. C. an international subsidiary

4. D. a merger

5. Answer: A. an acquisition

6. Question: Which of the following gives the government power to break up large firms into smaller ones, in certain cases?

7. A. Nationalization policies

8. B. Market regulations

9. C. Restrictive practices

10. D. Antitrust laws

11. Answer: D. Antitrust laws

12. Question:

13. Answer: enter the market; to exit

14. Question: Government policy-makers often must decide how to balance the potential benefits of __________ against the potential benefits of __________.

15. nationalization; privatization

16. competition; nationalization

17. corporate size; predatory pricing

18. corporate size; competition

19. Answer: corporate size; competition

20. Question:

21. Answer: the new firm will produce more efficiently and all of the above