Why Are Monopolies a Problem Sometimes

question 52

Multiple Choice

Why are monopolies a problem sometimes?

• A) They present a barrier to free trade between nations.
• B) They are typically wasteful and inefficient with their resources.
• C) They force people to buy products they do not want.
• D) A business can raise prices without fear of losing customers to competitors.
• E) Banks are less likely to make loans and free up capital for investment.

---

Definitions:

Sarbanes-Oxley Act

A law enacted in response to a number of major corporate and accounting scandals to protect shareholders and the general public from accounting errors and fraudulent practices in enterprises.

Securities And Exchange Commission

A U.S. government agency responsible for regulating the securities industry, enforcing federal securities laws, and overseeing the stock and options exchanges.

Due Diligence

A comprehensive appraisal or investigation of a business or person prior to signing a contract, or an act with a certain standard of care.

Registration Statement

A document filed with the Securities and Exchange Commission (SEC) that contains details about an investment offering for sale to the public.