Question

Cooperation among oligopolies runs counter to the public interest because it leads to underproduction and high prices. In an effort to bring resource allocation closer to the social optimum, public officials attempt to force oligopolies to compete instead of cooperating.Consider the following scenario:Suppose that two American investment banks negotiate a merger agreement because a financial crisis threatens to bankrupt both firms.This merger could potentially be stopped by a lawsuit brought by which of the following American institutions?a. The Defense Departmentb. The Commerce Departmentc. The Justice Departmentd. The Interior Department

Answer 1

The correct answer is letter "C": The Justice Department.

Step-by-step explanation:

The United States Department of Justice (DOJ) enforces the law and defends the interest of the U.S. The entity seeks fair punishment for all those with unlawful behavior and ensures public safety from foreign and domestic threats. Through the Antitrust Division (ATR), the institution reviews mergers and acquisitions to verify their effect and it challenges those that threaten to harm fair competition.