everything else was included. The merger was allowed.

4. The common expectation is that the definition of markets will become broader because of greater

competition from faraway places. However, this broadening doesn’t necessarily mean that antitrust

authorities can relax. There is also a fear that companies with a local or national monopoly may use the

new opportunities to extend their reach across national borders, and that it will be difficult for national

authorities to respond.

5. Because outright collusion to raise profits is illegal and because existing regulations include gray areas

which firms may be able to exploit.

6. Yes, all curves have normal shapes.

7. Yes it is a natural monopoly because average costs decline over the range that satisfies the market

demand. For example, at the point where the demand curve and the average cost curve meet, there are

economies of scale.
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