The Capture Theory of Regulation, Espoused by George Stigler, Asserts

question 27

Multiple Choice

The capture theory of regulation, espoused by George Stigler, asserts that

• A)consumers "capture" regulatory agencies so that regulation favors consumers
• B)producers "capture" regulatory agencies so that regulation favors producers
• C)regulators "capture" producers and limit their market power
• D)consumers "capture" some consumer surplus lost to monopoly
• E)consumers and producers work together to "capture" regulatory agencies in order to achieve more
• Desirable regulation

---

Definitions:

Level of Spoilage

The quantity or rate of goods that are damaged or deteriorated to the extent that they cannot be sold as first-quality merchandise.

Ratio Comparison

A method of analysis where financial ratios of a company are compared to industry benchmarks or the company's historical figures to assess performance.

Credit Manager

A professional responsible for granting credit to customers and managing the credit risk for a company.

Quick Ratio

A liquidity indicator that measures a company’s ability to pay off its current liabilities without relying on the sale of inventory by dividing liquid assets by current liabilities.