Economics Set 5

Clayton Act

An amendment passed by the U.S. Congress in 1914 that provides further clarification and substance to the Sherman Antitrust Act of 1890. The Clayton Antitrust Act attempts to prohibit certain actions that lead to anti-competitiveness.

Sherman Anti-Trust Act

First Anti-monopoly U.S. law which attempted to increase economic competitiveness. The Sherman Antitrust Act of 1890 made it illegal for companies to seek a monopoly on a product or service, or form cartels.

Mergers

a combination of two or more companies to form a single business

Natural Monopoly

a market situation in which the costs of production are minimized by having a single firm produce the product

Public Goods

economic goods that are consumed collectively such as highways and national defense

Private Goods

goods that, when consumed by one individual, cannot be consumed by another

Antitrust laws

legislation to prevent new monopolies from forming an police those that already exist

Externality

the unintended side effect of an action that affects someone not involved in the action

Monopoly

when the market create a sole provider for a good or service