Additional Application Monopolies Are Not Always Easily Ended.The European Commission's Directorate for Directorate

question 53

Multiple Choice

Additional Application
Monopolies are not always easily ended.The European Commission's directorate for the internal market is attempting to end Germany's chimney sweeps' monopoly.For many decades the chimney sweeps in Germany have held a "near-perfect monopoly." While the profession is a private enterprise the local governments set the prices,control the number of sweeps in each district,require that households are inspected,and will not allow consumers to choose a different sweep even if they do not like the one they have.Due to the required annual inspections,sweeps always have jobs and any new entrants into the market will wait years before they are given a district to operate in.One argument in favor of this monopolistic arrangement is based on public safety.If new sweeps are not allowed to enter the industry then quality regulation is more easily insured.If the current sweeps continue to earn profits,none will leave the industry either.While the European Commission wants a more competitive market,they realize that it will not develop soon.
"Chimney Sweeps Under Fire," The Economist,October 21,2006,p.76.
-How is the chimney sweep monopoly maintained?

• A)The government does not allow easy entry for competitors.
• B)Chimney sweeps hold closed meetings that exclude all competitors.
• C)The level of technology is too sophisticated for most new entrants to comprehend.
• D)The consumers want it to remain noncompetitive.

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