Question

one of the reasons fewer antitrust cases have been brought before the court is:

a. input prices have fallen significantly

b. the United States is engaged in trade wars

c. the rate of the technological change has accelerated

d. firms have become increasingly larger

Answer 1

Answer: Option 'd' is correct. Because of large size of firms, horizontal merger and acquisition becomes generally difficult and thus leading to very less number of antitrust cases.

Fall in input prices can lead to a number of antitrust actions and cartels and conglomarates can be formed to fetch extra-ordinary profits.

Trade wars have effect on import and exports. The decrease in import can incentivize US firms to merge and earn monopoly profits.

It is not the technological change but the technological lock-in that causes consumers to stuck to older products and companies may refrain consumers to go for better alternatives. The example is QWERTY keyboard and other borwsers.

Hence option 'd' is correct.