Asked by
Hassan Hossainzada
on Dec 12, 2024
Verified
Suppose a market is initially competitive with many firms selling an identical product. Over time, however, suppose the merging of firms results in the market being served by only three or four firms selling this same product. As a result, we would expect
A) an increase in market output and an increase in the price of the product.
B) an increase in market output and an decrease in the price of the product.
C) a decrease in market output and an increase in the price of the product.
D) a decrease in market output and a decrease in the price of the product.
Market Output
The aggregate amount of products and services created and available for purchase within a market.
Merging of Firms
The process where two or more separate entities come together to form a single, combined organization, typically to achieve economic efficiencies or market advantages.
Identical Product
A product that is exactly the same in every detail and attribute as another, making them indistinguishable from each other.
- Assess the effects of barriers to market entry on competition and market outcomes.
Verified Answer
SE
Learning Objectives
- Assess the effects of barriers to market entry on competition and market outcomes.