Suppose you are an economist for Mattel, manufacturer of the doll Barbie, which was making an unsolicited bid to take over Hasbro, manufacturer of the doll G. I. Joe. a. Would you argue that the relevant market is dolls, preschool toys, or all toys including video games? Why?

1. You would want the regulatory boards to see more competition, so you would argue that the relevant market is all toys, which is as broad as possible. This would make it less likely that the merger would violate merger guidelines.
2. You would want the regulatory boards to see more competition, so you would argue that the relevant market is all toys, which is as narrow as possible. This would make it less likely that the merger would violate merger guidelines.
3. You would want the regulatory boards to see more competition, so you would argue that the relevant market is dolls, which is as narrow as possible. This would make it less likely that the merger would violate merger guidelines.
4. You would want the regulatory boards to see more competition, so you would argue that the relevant market is dolls, which is as broad as possible. This would make it less likely that the merger would violate merger guidelines.

b. Would your answer change if you were working for Hasbro?

1. You would want to use the narrowest definition of the market, which would be dolls. This would make it less likely that the merger would violate merger guidelines.
2. You would want to use the narrowest definition of the market, which would be dolls. This would make it more likely that the merger would violate merger guidelines.
3. You would want to use the broadest definition of the market, which would be all toys. This would make it more likely that the merger would violate merger guidelines.
4. You would want to use the narrowest definition of the market, which would be all toys. This would make it less likely that the merger would violate merger guidelines.