Exam 22: Antitrust Law and Promoting Competition

To prevent its competitors from obtaining sufficient supplies to make their products, Continental Steel, Inc., uses its market power on the buy side to increase the prices of those supplies. This is

Monopoly power in and of itself constitutes the offense of monopolization under the Sherman Act.

Predatory pricing involves selling a product at prices substantially above the fair market value.

A restraint of trade is an agreement between firms that has the effect of reducing anticompetitive business practices.

Price discrimination occurs when a seller charges different prices to competing buyers for identical goods or services.

​Labor unions can organize and bargain without violating antitrust law.

Unilateral conduct cannot result in a violation of antitrust law.

When a small number of companies share a large part of a market, the market is concentrated.

Refer to Fact Pattern 22-1. Bodycare pays Deja Vu not to sell its product, thereby restricting output. This is

Sunrich Company can process solar energy into an inexpensive fuel for internal combustion engines. As an innovator in its market, Sunrich currently has the power to affect the price of its product. This is

By contract, Oil Shale Corporation forbids Petro Refining, Inc., a wholesale buyer of Oil Shale's products, from purchasing the products of its competitors. This exclusive-dealing contract is not permitted

An act must substantially affect interstate commerce to violate the Sherman Act.

In determining the legality of a merger, market concentration has no significance.

Glassworx Corporation has exclusive control over the market for its products. Under antitrust law, this is

Frozen Confections Corporation makes and sells ice cream under a variety of brand names. Frozen wants to merge with Grocers Products Company, its main competitor. In considering a challenge to the deal, a court looks at the relevant product market. This most likely includes ice cream and

Any conspiracy-even if it occurs outside the United States-that has a substantial effect on U.S. commerce is within the reach of the Sherman Act.

Rugged Bikes, Inc., makes and distributes Rugged-brand bicycles and accessories to authorized dealers, including Super Sports Stores, Inc. To insulate other dealers from direct competition with Super Sports, Rugged Bikes imposes limits on where Super Sports can sell Rugged products. This is

North Mining Company and South Excavation Company agree to abide by the decisions of East Coast Financial Corporation as to their respective levels of production, markets, and prices, effectively reducing competition and increasing profits. This is most likely

The basis of antitrust legislation is our society's desire to foster competition.

Any action challenged as an attempt to monopolize must have been specifically intended to exclude competitors and garner monopoly power.