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The " big three" auto manufactures in the US were in financial trouble, with both General motors and Chrysler filling for bankruptcy and significantly downsizing. Chsysler being taken over by Italian car maker Fiat, and GM ceding majority ownership to the U.S goverment in return for over $20 billion in bailout money
1) why do you think the U.S auto industry was in financial trouble, especially compared to its foreign competition ?
2) What do you think will be the economic consequences of a goverment bailout of the auto industry ?
3) Do you believe the goverment should assist the auto industry ? if so, why and what way should they assist ? if not, why not ?
4) The industry is an oligopoly in manufacturing but monopolistic on the store level . Does the fact that the industry is an oligopoly affect your opinion regarding a potential bailout ? why or why not ? How might your answer differ if the auto industry was a monopoly or monopolistically competitive ?
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