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4. (5 points) Some grocery stores and other shopping chains have signs near their cart EL! corrals that. say HELP KEEP YOUR COST DOWN RETURN

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4. (5 points) Some grocery stores and other shopping chains have signs near their cart EL"! corrals that. say \"HELP KEEP YOUR COST DOWN RETURN CARTS HERE\" (see https://i.redd.it/omy84lcqt7131. jpg for an example). Suppose that. these stores are following a markup rule prices are marked up over marginal costs based on the price elasticity of demand. Is the idea expressed by these signs true? (i.e. if more people return their carts to the corrals, are prices lower?) W'hy or why not? (Hint: There are arguments both for and against here. Pick one and go with it) (5 points) Microsoft and Activision are attempting to merge (see e.g. https:// tinyurl.com/4292pnbj). Consider Microsoft as a manufacturer of video game con- soles (Xbox) and Activision of a developer of video games (Call of Duty, Overwatcln World of Warcraft: etc.). (a) (2 points) What kind of merger is this? Why? (1)) (3 points) Sony makes PlayStation, which competes with Xbox. Many of Ac- tivision's titles are currently released both on PlayStation and on Xbox. Sony is afraid that if the merger is completed, those titles will no longer appear on PlayStation. What should we expect the effect of the merger on consumers to be? If your answer is \"it depends\" (and it should), give a reason to believe that the merger may increase consumer welfare and give a reason to believe that the merger may decrease consumer welfare

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