In 1995 the U

question 144

Essay

In 1995 the U.S. Justice Department sued to block a merger between Microsoft and Intuit, the producer of the nation's best-selling business software. The Justice Department argued that the merger would lessen competition and raise prices of business software. Is there an economic argument that the merger might actually result in lower prices? Explain.

---

Definitions:

Activity Measures

Metrics used to assess the efficiency and performance of different business activities, often in the context of activity-based costing.

Overhead Costs

Expenses not directly tied to the production of goods or services, such as rent, utilities, and insurance.

Overhead Costs

Expenses that are not directly tied to production activities, such as rent, utilities, and administrative expenses.

Batch-level Activities

Operations carried out on groups or batches of units rather than on individual units, often incurring costs that are common to the batch rather than to a single unit.