Mergers are treated differently, depending on the type of merger and the effect on the industry. There are three types of mergers: Horizontal mergers are between companies selling similar products in the same market; Vertical mergers are between firms at different stages of the production process in the same industry; Conglomerate mergers are between firms in unrelated industrie
a. Consider a product that you purchase that has been affected by a merger. What type of merger was it? Did it affect the product or price?
b. Suppose a proposed merger of firms would simultaneously lessen competition and reduce unit costs through economies of scale. Do you think such a merger should be allowed?
c. What types of industries, if any, should be subjected to industrial regulation? What specific problems does industrial regulation entail?