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Legl 4400 Test 3a questions with complete solutions 2024
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Legl 4400 Test 3a questions with complete solutions 2024
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Legl 4400 Test 3Antitrust - correct answer ✔To regulate and promote a competitive
marketplace
- Applies to big and small companies
- big penalities
Antirust federal legislation - correct answer ✔Sherman Act
Clayton Act
Federal Trade Commission Act
Restraints of trade - correct answer ✔Price fixing, max/min pricing, price
maintenance, allocating territories, group boycotts
- needs concerted action, or agreement between two or more parties
Horizontal Restraint - correct answer ✔Any agreement that in some way
restrains competition between rival firms competing in the same market.
- per se illegality
Vertical Price fixing - correct answer ✔Occurs when parties at different levels
of the same supply chain restraint competition
- Rule of reason
Sherman Act Section 2 - correct answer ✔Regulates monopolies of
interstate or foreign commerce
- Violation requires plaintiff to prove that the defendant had monopoly power
and willfully acquired or maintained that power through anti-competitive
behavior
, Predatory conduct - correct answer ✔seeking to advance market share by
injuring competitors by means other than improved performance
Predatory pricing - correct answer ✔selling a product below cost to drive
competitors out of the market and then raising to recoup lost dollars
who enforces anti-trust laws? - correct answer ✔Federal Trade Commission
and Department of Justice
Exlusive dealing - correct answer ✔will only deal with the other party for
certain goods
- only a problem with significant market share
- Can be violation of Clayton act
Tying Contract - correct answer ✔product in a dominant market position sold
only on condition that the buyer purchases a different (non-dominant) product
from the seller
- in violation of Clayton Act
- full line forcing
Reciprocal Dealing - correct answer ✔parties link their purchases together -
you buy from me and I buy from you
- in violation of Clayton act if it is tied together in the contract
Vertical merger - correct answer ✔Merger in which one company is a
customer of the other in one of the lines of business
- can be problematic under Clayton Act
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