Week 3 Discussion Board and Written Assignment answers (non-APA)

Week 3 Discussion - Discussion#1 Monopolies Ch.12 Problem#2 Disagree The breakup of a monopoly is not efficient because there is an up side for

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Discussion #1: Monopolies Ch.12, Problem #2 Disagree. The breakup of a monopoly is not efficient because there is an up side for consumers in society because it allows for free market competition but it can be bad for stockholders because their company has lost its monopoly on that industry. It is a Pareto- efficient change though because it brings us closer to perfect competition and thus, closer to a Pareto efficient condition. Additionally, by adding potential to the condition, we can say a change is potentially efficient because the result is good overall for society. So when the anti-trust court looks at the overall picture, it believes the benefits to consumers will outweigh the loss for stockholders so this is a potentially efficient change. Thus, we have a potentially efficient change that brings us closer to a Pareto optimal condition. Many economists term this as a “Pareto improvement.” Discussion #2: Changing Interest Rates Ch.11, Problem #5 When interest rates rise, ceteris paribus
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This note was uploaded on 09/15/2011 for the course ECONOMICS eco 203 taught by Professor Sampalazzolo during the Spring '10 term at Ashford University.

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Week 3 Discussion - Discussion#1 Monopolies Ch.12 Problem#2 Disagree The breakup of a monopoly is not efficient because there is an up side for

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