Term
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Definition
| When certain employees are treated differently or worse by their bosses, managers, supervisors based on sex/creed/religion |
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Term
| govs role in public sector |
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Definition
Provide legal structure
Maintain competition
Redistribute income
Reallocation of resources
Promote economic stability |
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Term
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Definition
promote competition among firms
Leads to lower prices to consumers |
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Term
| Sherman Antitrust Act 1890 |
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Definition
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Term
| sherman antitrust section 1 |
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Definition
| if something in the form of a trust restrains trade or commerce, it is illegal |
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Term
| sherman antitrust section 2 |
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Definition
| anyone who monopolizes or attempts to, is guilty of a misdemeanor |
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Term
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Definition
enacted to strengthen the Sherman Act
Outlawed unjust price discrimination
Outlawed tying contracts (unless a firm needed to maintain control over complementary goods and services to ensure its product worked properly
Outlawed mergers that substantially lessened competition |
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Term
| Federal trade commission act of 1914 |
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Definition
Established FTC to investigate unfair practices
May use Cease and Desist orders
Authority to investigate various aspects of US economy
Prevent undesirable, unfair, or predatory, competitive practices
Outlaws untrue and deceptive advertising |
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Term
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Definition
Amended FTC Act
Gave FTC power to check false advertising of
Food
Drug
Medical devices
Cosmetics |
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Term
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Definition
Amended Clayton Act 1914
Defined price discrimination more fully
Prohibits businesses from selling products of like grade and quality to two or more buyers at different prices |
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Term
| Exceptions to the robinson patman act |
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Definition
Perishable goods
Competitive markets
Going out of business
Discounts to special groups |
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Term
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Definition
Amended Clayton Act
Defined mergers more fully
Mergers were defined by asset acquisition
“The effect of such acquisition may be substantially to lessen competition or tend to create a monopoly” |
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Term
| Hart Scott Rodino Antitrust improvements act 1976 |
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Definition
Required pre-approval by the federal government of large mergers
Allows State Attorney General to bring antitrust suits on behalf of its citizens |
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Term
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Definition
when firms in a market fix all their prices, they restrain trade
Violation of Sherman Antitrust Act 1890 |
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Term
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Definition
situation in which a buyer is not permitted to purchase one item without also purchasing another
Violation of Clayton Act 1914 |
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Term
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Definition
selling a product below cost to drive out competition and then raising price
Violation of FTC Act of 1914 |
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Term
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Definition
charging higher prices during demand peaks and lower prices during demand troughs
May violate pricing of government regulated industries |
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Term
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Definition
the practice of selling the same product at more than on price when the price differences do not reflect change in costs
Violation of Clayton Act 1914
Violation of robinson-Patman Act 1936 |
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Term
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Definition
| charging initial fee plus a usage fee for a good or service |
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Term
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Definition
| charging initial fee plus a usage fee for a good or service charging initial fee plus a usage fee for a good or service |
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Term
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Definition
| material misrepresentation likely to mislead a potential consumer and would mislead a reasonable consumer |
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Term
| perfect competition pricing in short run |
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Definition
| Profit Max occurs when Price = Marginal Revenue = Marginal Cost |
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Term
| perfect competition pricing in the long run |
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Definition
| Profit Max occurs when ATC = MR = MC |
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Term
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Definition
| Many firms, some product differentiation, low obstacles to entry, some non-price competition, extensive advertising |
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Term
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Definition
P = L + M + K + F/Q + (Pr * A)/Q
P ⇒ price
L ⇒ unit of labor
M ⇒ unit material cost
K ⇒ unit market cost
F ⇒ fixed cost
Q ⇒ units to be produced
Pr ⇒ desired profit rate
A ⇒ assets |
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Term
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Definition
| ftc issues a cease and desist order, stops firms from running the ad, may require the firm to run a corrective ad, potential court actions taken |
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Term
| determinants of market structures |
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Definition
| # of firms, types of products, barriers of entry control over price |
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Term
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Definition
| info to consumers, increases competition, lowers entry barriers |
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Term
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Definition
| psychological manipulation, impedes competition, consumers become less price sensitive, more market power |
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Term
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Definition
| small # of firms, STRATEGICALLY INTERACT (INTERDEPENDENCE), firms have price setting power, high barriers of entry |
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Term
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Definition
| one seller, total obstacles of entry, price set by seller, no production substitution, no competition, ads used to expand market and promote goodwill |
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Term
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Definition
| govt protects citizens from businesses |
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Term
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Definition
| an organization that combines inputs to produce goods and services in order to earn a profit |
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Term
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Definition
land- nat resources
labor- human effort
capital- man made resource
entrepreneurial expertise- management |
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Term
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Definition
| sole proprietorship, partnership, corporation |
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Term
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Definition
| one owner, unlimited liability, owner retains profit, easy entry and exit, financial limitations, management deficiencies, specialized mgmt skills, legal restrictions |
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Term
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Definition
| 2 or more owners, easily formed, increased mgmt, increased finances, personal assets at risk, interpersonal conflicts |
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Term
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Definition
| chartered by state, unlimited owners, limited liability, expaded finances |
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Term
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Definition
| stockholder, board of directors, ceo, middle management, lower management |
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Term
| stockholders and board of directors |
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Definition
| who are the principals in the principal agent problem in corporations |
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Term
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Definition
| who are the agents in the principal agent problem in corporations |
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Term
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Definition
agents place personal goals ahead of corporate goals
-seperation of ownership and management |
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Term
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Definition
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Term
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Definition
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Term
| Fixed Costs + Variable Costs |
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Definition
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Term
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Definition
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Term
| Total Variable Cost/Output |
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Definition
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Term
| Average fixed cost + Average variable cost |
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Definition
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Term
| change in total cost/ change in quantity |
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Definition
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Term
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Definition
| sales level to be reached to avoid losses |
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Term
| work place discrimination |
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Definition
| when workers are disciminated against because of their characteristics |
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Term
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Definition
| the price at which consumers value each number of units demanded |
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Term
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Definition
| difference between what a consumer is willing to pay vs. what is actually paid |
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Term
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Definition
| difference between the market price and what the producer is willing to recieve |
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Term
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Definition
| prevent monopolization through illegal practices, prevent mergers that reduce competition and raise price, prevent and monitor: price fixing, tying contracts, price discrimination, predatory pricing, two part tariff, and peak load pricing |
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Term
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Definition
| the lengthy delays for hearings and appeals over govt regulations on antitrust violations |
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