Industry analysts feel that Bluecorp paid far too much to acquire
rival Â…rm Strickland. While doing so limited competition they face
in the marketplace, this approach cannot be proÂ…table in the long
run. Once two rival Â…rms merge in order to increase proÂ…ts, the
higher prices would only provide other competitors an opportunity
to enter the Â…eld at a lower price, cutting into BluecorpÂ’s proÂ…ts
and making the acquisition of Strickland an expensive mistake.
Which of the following, if true, most seriously weakens the
argument?
(A) In some countries it is legal for two companies to merge
even if the resulting entity would nearly monopolize the
market.
(B) The combination of Bluecorp and Strickland creates an
entity whose size allows it to produce items at a far lower
cost than could any smaller enterprise.
(C) In addition to eliminating competition, BluecorpÂ’s
acquisition gives it a much more substantial presence
in urban areas.
(D) As a result of the acquisition, the new corporate entity
will create two smaller entities to operate as independent
suppliers to Bluecorp.
(E) When two large companies in the same Â…eld combine,
entrepreneurs tend to shy away from the Â…eld due to the
single entityÂ’s perceived dominance.
Confuse between B and E
rival Â…rm Strickland. While doing so limited competition they face
in the marketplace, this approach cannot be proÂ…table in the long
run. Once two rival Â…rms merge in order to increase proÂ…ts, the
higher prices would only provide other competitors an opportunity
to enter the Â…eld at a lower price, cutting into BluecorpÂ’s proÂ…ts
and making the acquisition of Strickland an expensive mistake.
Which of the following, if true, most seriously weakens the
argument?
(A) In some countries it is legal for two companies to merge
even if the resulting entity would nearly monopolize the
market.
(B) The combination of Bluecorp and Strickland creates an
entity whose size allows it to produce items at a far lower
cost than could any smaller enterprise.
(C) In addition to eliminating competition, BluecorpÂ’s
acquisition gives it a much more substantial presence
in urban areas.
(D) As a result of the acquisition, the new corporate entity
will create two smaller entities to operate as independent
suppliers to Bluecorp.
(E) When two large companies in the same Â…eld combine,
entrepreneurs tend to shy away from the Â…eld due to the
single entityÂ’s perceived dominance.
Confuse between B and E
