The Existence of Market Power in an Industry Implies That

question 40

Multiple Choice

The existence of market power in an industry implies that:

• A) government should enact regulations to make the industry more competitive.
• B) consumers should form consumer protection groups to offset the market power in the industry.
• C) government should provide subsidies to encourage firms to enter the industry. As the number of firms increases market power will decline.
• D) price is greater than marginal cost.

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