Reduced competition through merging of companies will raise social welfare
A)if the social cost from the synergies exceeds the benefit of increased market power.
B)if the benefit from the synergies exceeds the social cost of increased market power.
C)always.
D)never.

Question

Quizplus · Accepted Answer

Merging companies can lead to synergies such as cost reductions and innovation, which can increase social welfare if these benefits outweigh the social costs associated with increased market power, such as higher prices and reduced competition.

Reduced Competition Through Merging of Companies Will Raise Social Welfare