In the absence of a generally accepted and enforced system of fair competition legislation,which of the following is likely to occur?
A) All firms will join forces and form a cartel.
B) A cost-efficient firm will form a natural monopoly.
C) Consumers will likely enjoy prices that are below the cost of production.
D) Gangster capitalism.
E) All firms will charge the same price.

Question

Quizplus · Accepted Answer

Gangster capitalism is likely to occur in the absence of a generally accepted and enforced system of fair competition legislation. This is because firms may resort to illegal or unethical practices to gain an advantage over their competitors.

In the Absence of a Generally Accepted and Enforced System