Question 1

An agreement between real estate brokers to never charge a commission less than 6% is not an example of price fixing.

Accepted Answer

A) True 
 B)False

Question 2

An agreement to charge an agreed-upon price or to set maximum or minimum prices between or among competitors is called price fixing but it is not per se a violation of the Sherman Act.

Accepted Answer

A) True 
 B)False

Question 3

Quickness Computer, Inc. is a manufacturer of computers. A Hollywood star indicated on national television that Quickness was his favorite computer. Buoyed by this comment, sales of Quickness computers surged. Since demand outpaced supply, Quickness decided to sell no more computers unless an accompanying software package was purchased. A competitor informed the Office of the Attorney General of this policy, asserting it was illegal. Decide.

Accepted Answer

This is a tying arrangement (or tying sa

Question 4

The Sherman Act applies to all of the following except:

Accepted Answer

A)  buying activities. 
B)  selling activities. 
C)  production activities. 
D)  price discrimination. 
A)  buying activities. 
B)  selling activities. 
C)  production activities. 
D)  price discrimination.

Question 5

The Robinson-Patman Act:

Accepted Answer

A)  prohibits charging different prices to different buyers when the margin costs are the same. 
B)  allows sellers to offer incentives and bonuses to certain customers. 
C)  allows sellers to refuse to deal with anyone for any reason. 
D)  prohibits boycotts among competitors. 
A)  prohibits charging different prices to different buyers when the margin costs are the same. 
B)  allows sellers to offer incentives and bonuses to certain customers. 
C)  allows sellers to refuse to deal with anyone for any reason. 
D)  prohibits boycotts among competitors.

Question 6

The government can regulate not just businesses, but also business competition and prices.

Accepted Answer

A) True 
 B)False

Question 7

The attorney general of a state may bring a class action suit to recover damages for those injured by an antitrust violation which raised prices.

Accepted Answer

A) True 
 B)False

Question 8

A divestiture order is a decree ordering a defendant to dispose of excessive ownership or control of interests in competing enterprises.

Accepted Answer

A) True 
 B)False

Question 9

The Clayton Act prohibits:

Accepted Answer

A)  all unfair methods of competition. 
B)  conspiracies in restraint of trade. 
C)  attempts to monopolize. 
D)  price discrimination between buyers of like commodities. 
A)  all unfair methods of competition. 
B)  conspiracies in restraint of trade. 
C)  attempts to monopolize. 
D)  price discrimination between buyers of like commodities.

Question 10

A price reduction to one customer is lawful when it is made because of the deteriorated condition of the goods sold to that customer.

Accepted Answer

A) True 
 B)False

Question 11

Governments may regulate prices but not credit terms.

Accepted Answer

A) True 
 B)False

Question 12

For violation of the Sherman Act, the maximum fine that may be imposed on a natural person is:

Accepted Answer

A)  $1 million. 
B)  $500,000. 
C)  $0. 
D)  $100 million. 
A)  $1 million. 
B)  $500,000. 
C)  $0. 
D)  $100 million.

Question 13

Under the Clayton Act, a divestiture order is:

Accepted Answer

A)  notification from the Department of Justice that a merger is about to occur. 
B)  notification from the Department of Justice that a merger did not occur. 
C)  a decision by a court requiring a defendant to sell an enterprise. 
D)  an order by a court requiring an enterprise to dispose of its inventory. 
A)  notification from the Department of Justice that a merger is about to occur. 
B)  notification from the Department of Justice that a merger did not occur. 
C)  a decision by a court requiring a defendant to sell an enterprise. 
D)  an order by a court requiring an enterprise to dispose of its inventory.

Question 14

A person or enterprise harmed by a Sherman Act violation may bring an action for:

Accepted Answer

A)  punitive damages only. 
B)  treble damages. 
C)  quadruple damages. 
D)  actual damages only. 
A)  punitive damages only. 
B)  treble damages. 
C)  quadruple damages. 
D)  actual damages only.

Question 15

Under the Sherman Act, any person who attempts to monopolize any part of the trade or commerce among the states shall be:

Accepted Answer

A)  guilty of a misdemeanor. 
B)  guilty of a felony. 
C)  fined up to $500,000. 
D)  guilty of a conspiracy to be a monopoly 
A)  guilty of a misdemeanor. 
B)  guilty of a felony. 
C)  fined up to $500,000. 
D)  guilty of a conspiracy to be a monopoly

Question 16

The Sherman Act focuses on:

Accepted Answer

A)  unfair methods of competition. 
B)  combinations or contracts in restraint of trade. 
C)  permitted price discriminations. 
D)  intrastate commerce. 
A)  unfair methods of competition. 
B)  combinations or contracts in restraint of trade. 
C)  permitted price discriminations. 
D)  intrastate commerce.

Question 17

Vertical mergers:

Accepted Answer

A)  occur between firms that have a competitor relationship. 
B)  occur between firms that have buyer and seller relationships. 
C)  are not covered by the Clayton Act. 
D)  are always protected by the federal government. 
A)  occur between firms that have a competitor relationship. 
B)  occur between firms that have buyer and seller relationships. 
C)  are not covered by the Clayton Act. 
D)  are always protected by the federal government.

Question 18

When the effect of an antitrust violation is to raise prices:

Accepted Answer

A)  damages are automatically considered doubled. 
B)  each plaintiff must sue individually. 
C)  imprisonment for the guilty is mandatory. 
D)  the state attorney general may bring a class action suit for damages. 
A)  damages are automatically considered doubled. 
B)  each plaintiff must sue individually. 
C)  imprisonment for the guilty is mandatory. 
D)  the state attorney general may bring a class action suit for damages.

Question 19

Having a large percentage of the market is not necessarily a monopoly.

Accepted Answer

A) True 
 B)False

Question 20

Freezo Refrigerators are sold by various retailers. Most of the same retailers also sell Icy Refrigerators. The Freezo brand outsells Icy in some stores, but not in others. Freezo has decided to offer secret bonuses and discounts to retailers where the sale of Freezo Refrigerators lags behind the sale of Icy Refrigerators. Freezo sees this action as an advertising ploy to increase market share. Retail stores where Freezo is number one are not eligible for any of these bonuses and discounts. Discuss the implications of Freezo's advertising plan.

Accepted Answer

both the Clayton Act and the Robinson-Pa

Exam 5: Government Regulation of Competition and Prices

An agreement between real estate brokers to never charge a commission less than 6% is not an example of price fixing.

An agreement to charge an agreed-upon price or to set maximum or minimum prices between or among competitors is called price fixing but it is not per se a violation of the Sherman Act.

The Sherman Act applies to all of the following except:

The Robinson-Patman Act:

The government can regulate not just businesses, but also business competition and prices.

The attorney general of a state may bring a class action suit to recover damages for those injured by an antitrust violation which raised prices.

A divestiture order is a decree ordering a defendant to dispose of excessive ownership or control of interests in competing enterprises.

The Clayton Act prohibits:

A price reduction to one customer is lawful when it is made because of the deteriorated condition of the goods sold to that customer.

Governments may regulate prices but not credit terms.

For violation of the Sherman Act, the maximum fine that may be imposed on a natural person is:

Under the Clayton Act, a divestiture order is:

A person or enterprise harmed by a Sherman Act violation may bring an action for:

Under the Sherman Act, any person who attempts to monopolize any part of the trade or commerce among the states shall be:

The Sherman Act focuses on:

Vertical mergers:

When the effect of an antitrust violation is to raise prices:

Having a large percentage of the market is not necessarily a monopoly.

The Nature and Sources of Law

The Court System and Dispute Resolution

Business Ethics, Social Forces, and the Law

The Constitution As the Foundation of the Legal Environment

Administrative Agencies

Crimes

Torts

Intellectual Property Rights and the Internet

The Legal Environment of International Trade

Nature and Classes of Contracts: Contracting on the Internet

Formation of Contracts: Offer and Acceptance

Capacity and Genuine Assent

Consideration

Legality and Public Policy

Writing, Electronic Forms, and Interpretation of Contracts

Third Persons and Contracts

Discharge of Contracts

Breach of Contract and Remedies

Personal Property and Bailments

Legal Aspects of Supply Chain Management

Nature and Form of Sales

Title and Risk of Loss

Product Liability: Warranties and Torts

Obligations and Performance

Remedies for Breach of Sales Contracts

Kinds of Negotiable Instruments and Negotiability

Transfers of Negotiable Instruments and Warranties of Parties

Liability of the Parties Under Negotiable Instruments

Checks and Funds Transfers

Nature of the Debtor Creditor Relationship

Consumer Protection

Secured Transactions in Personal Property

Bankruptcy

Insurance

Agency

Third Persons in Agency

Regulation of Employment

Equal Employment Opportunity Law

Types of Business Organizations

Partnerships

LPs, LLCs, and LLPs

Corporate Formation

Shareholder Rights in Corporations

Securities Regulation

Accountants Liability and Malpractice

Management of Corporations

Real Property

Environmental Law and Land Use Controls

Leases

Decedents Estates and Trusts

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