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1Competition policy is an exclusive competency of the EU.
A)TRUE
B)FALSE


2The European Commission is in charge of making sure that Member States do not provide unfair subsidies to their firms
A)TRUE
B)FALSE


3The EU allows Member State to subsidise some firms, but controls these cases strictly.
A)TRUE
B)FALSE


4Allowing collusion among EU firms would help European since the gains to firms and their workers would outweigh the loses to consumers
A)TRUE
B)FALSE


5The Commission is in charge of discovering and breaking up price-fixing cartels in the EU.
A)TRUE
B)FALSE


6The main elements of EU competition policy are:
A)ensure that firms do not abuse a dominant position in the market.
B)ensure that no firm attains a dominant position in the market
C)ensure that firms do not engage in anticompetitive practices
D)a) and c)


7In the BE-COMP diagram analysis, integration plus subsidies that allow all firms that existed before integration to stay in business will:
A)a) lower welfare and this is why state aid is forbidden in the EU.
B)b) Result in overall welfare gains but not as great as if industry rationalisation were allowed to occur.
C)c) Would cost EU taxpayers more than EU consumers would gain.
D)none of the above is true.


8The power to policy anticompetitive practices was granted to the European Commission in:
A)The Treaty of Rome
B)The Single European Act
C)The Maastricht Treaty
D)The Constitutional Treaty


9The so-called efficiency defence of a merger is that:
A)the gains to society from reduced costs will more than compensate any potential increase in price.
B)The consequences of most mergers are so minor that it is not efficient to pursue a detailed investigation of their effects.
C)The market is efficient so any merger that firms find attractive should be efficiency-boosting.
D)all of the above


10It is often the case that firms could charge a higher price in one Member State than another if there were no arbitrage, so some firms have sought to segment that markets with:
A)Exclusive territories for retailers and market sharing agreements.
B)Tariffs and quotas.
C)Technical barriers to trade in the form of Single Market directives.
D)B and C are true.


11Perfect collusion is where:
A)Firms all agree to charge the monopoly price and divide the market among themselves.
B)A single firms takes the lead in price setting and controls the price through mergers and acquisitions.
C)Firms charge the highest price they can taking as given the price charged by other firms.
D)All of the above.


12The EU allows production subsidies in the case of:
A)firms located in disadvantaged regions, but these subsidies must be capped.
B)Member States who are particularly power in the Council of Ministers.
C)industries where the subsidy does not distort Single Market competition, such as cultural events
D)none of the above.





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