Unit 5 Assignment: Perfect Competition Profit Maximization and Monopoly Merger Guidelines
In this assignment, you will calculate total cost, total revenue, and total profit/loss. Based on the computed results, you will determine the optimal quantity of output that maximizes profit under a perfectly competitive market. Moreover, you will evaluate the antitrust laws and merger guidelines based on market shares of firms to prevent a monopoly and promote competition in the economy. Instructions: This assignment requires a combination of short paragraph answers and computations. You are required to follow proper APA format. You are required to use the Word Document Template attached in a file to complete the assignment In this assignment, you will be assessed on the following Outcome: GEL-7.02: Apply ethical reasoning to ethical issues within your field of study. How does the demand curve faced by a perfectly competitive firm differ from the market demand curve in a perfectly competitive market? Explain. How does the profit maximization condition for a monopoly differ from that for a perfectly competitive firm? How does this difference impact efficiency under each market structure? Explain. The following table provides market share information about the soft-drink industry. Review antitrust laws and the merger guidelines under Chapter 15: “Monopoly and Antitrust Policy” and conduct your own research on S. antitrust laws in the Online Library or the Internet to answer the following questions. Company Market Share Coca-Cola 37% Pepsi-Co 35% Cadbury Schweppers 17% Other 11% Compute the Herfindahl-Hirschman Index (HHI) market concentration rules that guide mergers between companies to prevent monopoly creation and to promote competition among firms. Based on the market shares of the companies in the table, the merger of which companies will be highly concentrated? What ethical rules will be affected based on U.S. antitrust laws and merger guidelines in regard to a highly concentrated market Do you think the Department of Justice and the Federal Trade Commission would approve a merger between any two of the first three companies listed in the table based U.S. merger guidelines and antitrust laws? Explain. Do you think this market has barriers to entry? If yes, what might be the market barriers?

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