Which of the Following Statements Is True of Antitrust Law

question 26

Multiple Choice

Which of the following statements is true of antitrust law?

• A)Antitrust laws facilitate market foreclosure by raising barriers to entry.
• B)Antitrust laws are designed to curb competition that poses threats to market dominant companies.
• C)Antitrust law does not apply in the event of a conglomerate merger.
• D)Antitrust law does not punish efficient companies who legitimately earn and maintain large market shares.

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Definitions:

Expected Return

The anticipated profit or loss from an investment, taking into account the potential outcomes and their probabilities.

SMB Beta

A measure used in the evaluation of stocks, indicating a stock's sensitivity to movements in the small minus big (SMB) factor, part of the Fama-French three-factor model.

HML Beta

A measure of sensitivity to the HML (High Minus Low) factor, part of the Fama-French three-factor model, indicating how much a stock's return is affected by the value premium.

Risk Premium

The additional return expected on an investment for taking on higher risk compared to a risk-free asset.