The so-called rule of reason, based on the 1920 U.S. Steel case, stipulates that a merger of two firms in an industry is
A)illegal if the firms are large.
B)illegal because it increases the monopoly power of the resulting firm.
C)legal if there is no resulting unreasonable restraint of trade.
D)legal because the firm will be subject to regulatory control.

Question

Quizplus · Accepted Answer

The rule of reason, as established in the 1920 U.S. Steel case, holds that a merger is legal as long as it does not result in an unreasonable restraint of trade, focusing on the merger's actual effects rather than its mere size or the increase in market power.

The So-Called Rule of Reason, Based on the 1920 U