Déjà vu all over again
As you know, the Federal Trade Commission successfully sued to block the proposed merger of Staples and Office Depot in 1997. Since then, various industry changes have occurred, including the 2013 acquisition of OfficeMax by Office Depot. In February 2015, Staples announced a deal to buy Office Depot. The FTC challenged the merger and a federal judge blocked the merger in May 2016.
You job is to analyze the decision of the judge. Do you agree with the ruling? If so, why? If not, why not? Note that an effective analysis will look at the arguments both in favor of and against the merger.
Assume that your audience is an intelligent person who understands economics and knows the details of the 1997 case. Assume that she has not, however, paid detailed attention to the industry in the past 20 years. Be as careful and specific as possible in explaining the situation and the relevant economic facts.
These solutions may offer step-by-step problem-solving explanations or good writing examples that include modern styles of formatting and construction
of bibliographies out of text citations and references. Students may use these solutions for personal skill-building and practice.
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There are many reasons as to why companies or businesses may want to dissolve or merge. The first reason is reducing costs. A bigger company or business enjoy very many privileges such as large economies of scale, larger discounts on the products because of large scale buying and incase a company is bankrupt, another company might chip in for aid by merging. The company also will gain a competitive advantage in the market through increased production and higher rate of sales. Staples and Office Depot companies were the best during this time (Moresi et al., 2017), merging the two businesses would have posed a very serious threat to some other competitors or create a monopoly market. One of the disadvantages of Monopoly market would be the extortion of prices of commodities since...