Question 1

Major, Inc. has 68% of the market share in a particular geographic region for one of its products. Does Major have a monopoly? Explain.

Accepted Answer

Monopoly power is the ability to control

Question 2

If Hyvac Vacuum Cleaners requires that Hyvac bags be used for the warranty to be valid, under the Sherman Act, this is:

Accepted Answer

A)  illegal per se. 
B)  a tying arrangement, which is always judged by rule of reason. 
C)  either illegal per se or judged by the rule of reason depending on the economic power of the seller and the amount of interstate commerce in cleaner bags affected. 
D)  no violation. 
A)  illegal per se. 
B)  a tying arrangement, which is always judged by rule of reason. 
C)  either illegal per se or judged by the rule of reason depending on the economic power of the seller and the amount of interstate commerce in cleaner bags affected. 
D)  no violation.

Question 3

Tying arrangements have been labeled by the Supreme Court as serving "hardly any purpose beyond the suppression of competition."

Accepted Answer

A) True 
 B)False

Question 4

The Clayton Act weakened the Sherman Act by eliminating illegal acts that had previously been prohibited.

Accepted Answer

A) True 
 B)False

Question 5

A manufacturer agrees to sell the distributor 1,000 boxes of 2-quart bowls only if he agrees to resell to the retailer at cost plus $1.10 per bowl and the retailer must agree to sell at no less than his cost plus .50 per bowl. This is:

Accepted Answer

A)  horizontal price fixing. 
B)  vertical price fixing. 
C)  vertical market allocation. 
D)  a group boycott. 
A)  horizontal price fixing. 
B)  vertical price fixing. 
C)  vertical market allocation. 
D)  a group boycott.

Question 6

The National Cooperative Research Act is designed to inhibit formation of joint ventures.

Accepted Answer

A) True 
 B)False

Question 7

Three of the airline companies agree that they will not go any lower than $100 each way for coast-to-coast tickets. This is:

Accepted Answer

A)  vertical price maintenance. 
B)  horizontal group boycott. 
C)  vertical market allocation. 
D)  horizontal price fixing. 
A)  vertical price maintenance. 
B)  horizontal group boycott. 
C)  vertical market allocation. 
D)  horizontal price fixing.

Question 8

Boycotts that are in violation of the Sherman Act include:

Accepted Answer

A)  a seller's refusal to deal with any particular buyer. 
B)  a manufacturer who refuses to sell to a retailer who persists in selling below the manufacturer's suggested retail price. 
C)  when two or more firms that have market power agree not to deal with a third party, thereby eliminating competition. 
D)  cooperative agreements designed to increase economic efficiency and render markets more competitive. 
A)  a seller's refusal to deal with any particular buyer. 
B)  a manufacturer who refuses to sell to a retailer who persists in selling below the manufacturer's suggested retail price. 
C)  when two or more firms that have market power agree not to deal with a third party, thereby eliminating competition. 
D)  cooperative agreements designed to increase economic efficiency and render markets more competitive.

Question 9

If a type of restraint is characterized as per se illegal:

Accepted Answer

A)  the plaintiff need only show that the type of restraint occurred. 
B)  the defendants may defend on the basis that the restraint was reasonable. 
C)  the court is required to conduct extensive economic analysis into the type of harm caused or the business excuse for use of the restraint. 
D)  the plaintiff must prove that the restraint limited competition. 
A)  the plaintiff need only show that the type of restraint occurred. 
B)  the defendants may defend on the basis that the restraint was reasonable. 
C)  the court is required to conduct extensive economic analysis into the type of harm caused or the business excuse for use of the restraint. 
D)  the plaintiff must prove that the restraint limited competition.

Question 10

The definition of price-fixing includes agreements that:

Accepted Answer

A)  may, among other things, depress prices. 
B)  stabilize prices. 
C)  raise prices. 
D)  All of these. 
A)  may, among other things, depress prices. 
B)  stabilize prices. 
C)  raise prices. 
D)  All of these.

Question 11

The Federal Trade Commission can act like a judicial body in conducting hearings and issuing orders to cease and desist.

Accepted Answer

A) True 
 B)False

Question 12

The National Tax Accountants Professional Association (TAPA) has recommended that its members charge a minimum of $25 per hour for completing tax forms. This recommendation is probably:

Accepted Answer

A)  a per se price-fixing violation of the Sherman Act. 
B)  not a violation of the Sherman Act, because it has been made by a professional association. 
C)  not a violation of the Sherman Act, because a fee is different from a price. 
D)  subject to the rule of reason. 
A)  a per se price-fixing violation of the Sherman Act. 
B)  not a violation of the Sherman Act, because it has been made by a professional association. 
C)  not a violation of the Sherman Act, because a fee is different from a price. 
D)  subject to the rule of reason.

Question 13

Under the Antitrust Criminal Penalty Enhancement and Reform Act of 2004, individuals who violate the Sherman
Antitrust Act may be imprisoned for ten years and fined up to $1,000,000.

Accepted Answer

A) True 
 B)False

Question 14

The 1936 Act prohibiting price discrimination in interstate commerce involving commodities of like grade and quality is the:

Accepted Answer

A)  Sherman Act. 
B)  Clayton Act. 
C)  Robinson-Patman Act. 
D)  Federal Trade Commission Act. 
A)  Sherman Act. 
B)  Clayton Act. 
C)  Robinson-Patman Act. 
D)  Federal Trade Commission Act.

Question 15

The National Cooperative Research Act:

Accepted Answer

A)  prohibits using the rule of reason test in judging joint ventures in research and development of new technology. 
B)  is designed to clear up uncertainty about the legality of joint ventures. 
C)  now requires treble damages if joint ventures are formed in violation of Section 1 of the Sherman Act. 
D)  All of these. 
A)  prohibits using the rule of reason test in judging joint ventures in research and development of new technology. 
B)  is designed to clear up uncertainty about the legality of joint ventures. 
C)  now requires treble damages if joint ventures are formed in violation of Section 1 of the Sherman Act. 
D)  All of these.

Question 16

The Clayton Act:

Accepted Answer

A)  was intended to stop certain trade practices before they become restraints of trade. 
B)  added criminal sanctions to the Sherman Act. 
C)  repealed the Robinson-Patman Act. 
D)  included labor organizations in its coverage. 
A)  was intended to stop certain trade practices before they become restraints of trade. 
B)  added criminal sanctions to the Sherman Act. 
C)  repealed the Robinson-Patman Act. 
D)  included labor organizations in its coverage.

Question 17

Margaret tells the members of the Raleigh Association of Restaurant Owners that they will be able to get a better price on linen supplies (tablecloths, napkins) if they will deal with one supplier rather than split their business between two. They all know Margaret deals with Niagara Linen rather than Cayuga. Under the Sherman Act, if they all sign contracts with Niagara:

Accepted Answer

A)  there is no violation since there is no express agreement to boycott Cayuga. 
B)  illegality may be inferred from this conduct. 
C)  there is no concerted action. 
D)  this is horizontal market allocation. 
A)  there is no violation since there is no express agreement to boycott Cayuga. 
B)  illegality may be inferred from this conduct. 
C)  there is no concerted action. 
D)  this is horizontal market allocation.

Question 18

A restraint of trade may be classified as either horizontal or vertical.

Accepted Answer

A) True 
 B)False

Question 19

In expanding its policy of enforcement regarding the Sherman Act to cover conduct by foreign companies that harms exports, the Justice Department has indicated that it will focus primarily on boycotts and cartels that injure the export of U.S. products and services.

Accepted Answer

A) True 
 B)False

Question 20

Under the Antitrust Criminal Penalty Enhancement and Reform Act of 2004, corporate offenders who violate
Sections 1 or 2 of the Sherman Act face fines of up to $100 million per violation.

Accepted Answer

A) True 
 B)False

Exam 40: Antitrust

Major, Inc. has 68% of the market share in a particular geographic region for one of its products. Does Major have a monopoly? Explain.

If Hyvac Vacuum Cleaners requires that Hyvac bags be used for the warranty to be valid, under the Sherman Act, this is:

Tying arrangements have been labeled by the Supreme Court as serving "hardly any purpose beyond the suppression of competition."

The Clayton Act weakened the Sherman Act by eliminating illegal acts that had previously been prohibited.

A manufacturer agrees to sell the distributor 1,000 boxes of 2-quart bowls only if he agrees to resell to the retailer at cost plus $1.10 per bowl and the retailer must agree to sell at no less than his cost plus .50 per bowl. This is:

The National Cooperative Research Act is designed to inhibit formation of joint ventures.

Three of the airline companies agree that they will not go any lower than $100 each way for coast-to-coast tickets. This is:

Boycotts that are in violation of the Sherman Act include:

If a type of restraint is characterized as per se illegal:

The definition of price-fixing includes agreements that:

The Federal Trade Commission can act like a judicial body in conducting hearings and issuing orders to cease and desist.

The National Tax Accountants Professional Association (TAPA) has recommended that its members charge a minimum of $25 per hour for completing tax forms. This recommendation is probably:

Under the Antitrust Criminal Penalty Enhancement and Reform Act of 2004, individuals who violate the Sherman Antitrust Act may be imprisoned for ten years and fined up to $1,000,000.

The 1936 Act prohibiting price discrimination in interstate commerce involving commodities of like grade and quality is the:

The National Cooperative Research Act:

The Clayton Act:

A restraint of trade may be classified as either horizontal or vertical.

In expanding its policy of enforcement regarding the Sherman Act to cover conduct by foreign companies that harms exports, the Justice Department has indicated that it will focus primarily on boycotts and cartels that injure the export of U.S. products and services.

Under the Antitrust Criminal Penalty Enhancement and Reform Act of 2004, corporate offenders who violate Sections 1 or 2 of the Sherman Act face fines of up to $100 million per violation.

Introduction to Law

Business Ethics and the Social Responsibility of Business

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance, Breach, and Discharge

Contract Remedies

Relationship of Principal and Agent

Relationship With Third Parties

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Products Liability: Warranties and Strict Liability in Tort

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature, Formation, and Powers

Financial Structure

Management Structure

Fundamental Changes

Secured Transactions and Suretyship

Bankruptcy

Protection of Intellectual Property

Consumer Protection

Employment Law

Securities Regulation

Accountants Legal Liability

Environmental Law

International Business Law

Introduction to Property, Property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Decedents Estates

the Legal Environment of Business

Contracts

Agency

Sales

Negotiable Instruments

Unincorporated Business Associations

Corporations

Debtor and Creditor Relations

Regulation of Business

Property

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