Mini Corp.and Huge,Inc.are competitors.Mini holds the single largest market share in the markets they compete in.Huge is third in terms of market share.Mini plans to acquire Huge.Which of the following,if true,would help bolster a conclusion that the acquisition is lawful under Section 7 of the Clayton Act?

A) That Mini has a history of acquiring ownership over competitors to increase its market share.
B) That there are about 25 competitors other than Mini and Huge while there were only 10 competitors 10 years ago.
C) That Mini has a 25 percent market share now and would only be increasing its market share by another 10 percent by acquiring Huge.
D) That Huge is an aggressive firm and it has developed a plethora of patentable technologies in the last five years.

Question

Fatih do?an Be?li · Accepted Answer

Final Answer : B, Explanation :  One of the factors that courts have traditionally considered relevant in determining the legality of horizontal mergers is whether there is a trend toward concentration in the relevant market.If it is true that apart from Mini and Huge,there are 25 other competitors now while there were only ten competitors ten years back,then it indicates a trend away from concentration in the market in which Mini and Huge compete.Therefore,this argument will bolster the conclusion that the acquisition of Huge by Mini is lawful under Section 7 of the Clayton Act.

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