CH 7 - Business-Government Relations

An example of a regulatory agency charged with enforcing social regulation is:

Federal Trade Commission.

Patterns of government taxing and spending that are intended to stimulate or support the economy are:

Fiscal policies.

Around the world, government:

Sometimes cooperates and sometimes is in conflict with business.

The Mullahs in Iran is an example of the power of government derived from:

A religious authority.

Deregulation has occurred in the following industries:

Commercial airlines, railroads, and financial institutions.

Past decisions of the courts, the original basis for the U.S. legal system, are called:

Common laws.

Public policy tools involve a combination of:

Incentives and penalties.

Governments being asked to regulate driving distractions are examples of a public policy:

Input.

When the market fails to adjust for the full costs of a firm's behavior, this is called:

Market failure.

Policies that affect the supply, demand, and value of a nation's currency are:

Monetary policies.

An example of an economic regulatory agency is:

National Labor Relations Board.

Economic regulations are illustrated by which action?

Preventing anticompetitive business practices.

The primary way of accomplishing public policy is through:

Regulation.

In the case Should Facebook be Regulated, the primary market failure was:

Sales incentives to sell user data exceeded those of protecting user privacy.

Total social regulation costs are:

Significantly higher than total economic regulation costs.

An example of a global regulation that mitigates the impact of jet fuel on the environment is:

The Aviation Plan.

Reregulation is:

The increase or expansion of government regulation.

Cooperation between business and government often occurs when:

They encounter a common problem or enemy.

A cooperative government-business relationship on one issue does not guarantee cooperation on another issue.

True

Cost-benefit analysis is often used to determine the costs of regulation.

True

Economic regulations aim at modifying the normal operations of the free market and the forces of supply and demand.

True

Predatory pricing is a violation of antitrust laws.

True

Sometimes national leaders resist the notion of international regulation, seeking to control matters of commerce themselves within their own countries.

True

European Union regulators accused Uber of engaging in:

Unfair competition.

Economists reported that the costs of regulatory compliance were highest for:

Worker safety.

Antitrust laws protect consumers from:

Anticompetitive practices by business.

Regulation cannot be applied to international business behavior.

False

Government's role is to create and enforce laws that:

Balance the relationship between business and society.

The antitrust enforcement agencies in the United States have the legal authority to:

Block anticompetitive mergers in the U.S.

Regulation can be argued as justified based on:

Utilitarian and justice grounds.

Managers' understanding of government regulations is:

Both a domestic and international issue.

By raising and lowering the interest rates at which private banks borrow money from the government, the Federal Reserve Bank:

Both of these answers are correct: Influences the size of the nation's money supply; and influences the value of the dollar.

Which of the following represents a structural remedy for an antitrust violation?

Breaking up a monopoly.

When a government orders companies not to conduct business in another country because of a war, human rights violations, or lack of a legitimate government; these orders are called:

Economic sanctions.

A national health care policy is an example of an economic policy.

False

Government and business together establish the regulatory rules under which business operates in society.

False

In Europe, unions are prohibited by law to be on businesses' administrative boards.

False

Public policy is a plan of action undertaken by business to influence the government.

False

The United Nations oversees all international agreements concerning regulations between nations.

False

In non-democratic countries, the power of government may derive from a monarchy, military dictatorship, or religious authority.

True

Which of the following are examples of natural monopolies?

Electric utilities and railroads.

Government regulations help balance negative externalities such as:

No smoking rules enforced to mitigate the effects of second-hand smoke.

Monetary policies refer to policies that affect the supply, demand, and value of the nation's currency.

True

New improved mining equipment that was found to increase cases of black lung disease because it generated higher levels of dust in the mines is an example of negative externalities.

True

Regulatory activity is often cyclical.

True