What Is One Reason Existing Firms Might Lobby the Government

question 54

Multiple Choice

What is one reason existing firms might lobby the government to increase regulation in their industry?

• A) It increases entry and exit costs, thereby reducing producer surplus to existing firms.
• B) It increases entry and exit costs, thereby potentially increasing producer surplus to existing firms.
• C) It increases entry and exit costs, but has no impact on producer surplus.
• D) Firms cannot be trusted to treat their customers fairly and ethically.

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Definitions:

Med-arb

A hybrid dispute resolution process combining elements of both mediation and arbitration, where a dispute may first be attempted to be resolved through mediation before moving to arbitration.

Arbitration

A method of dispute resolution where a neutral third party makes a binding decision to resolve a conflict outside of court.

Mediation

A form of alternative dispute resolution where a neutral third party helps disputing parties find a mutually acceptable solution.

Dispute Resolution

A process through which disagreements or conflicts are resolved, often involving negotiation, mediation, arbitration, or litigation.