Question 1

The purpose of antitrust legislation is to prevent competition.​

Accepted Answer

A) True 
 B)False

Question 2

Market power is the ability of a firm to enter a given market.​

Accepted Answer

A) True 
 B)False

Question 3

Friction-Lube Corporation and Grease Inc. are the principal suppliers of their products in their market. They agree that Friction-Lube will sell exclusively to retailers and Grease will sell exclusively to wholesalers. Under antitrust law, this market division is most likely​

Accepted Answer

A)  ​a per se violation. 
B)  ​a violation only if their competitors make similar deals. 
C)  ​a violation only if their customers agree to honor the deal. 
D)  ​not a violation. 
A)  ​a per se violation. 
B)  ​a violation only if their competitors make similar deals. 
C)  ​a violation only if their customers agree to honor the deal. 
D)  ​not a violation.

Question 4

Agreements that are deemed per se violations of Section 1 of the Sherman Act include all of the following except​

Accepted Answer

A)  ​a price-fixing agreement. 
B)  ​a group boycott. 
C)  ​a trade association. 
D)  ​a market division. 
A)  ​a price-fixing agreement. 
B)  ​a group boycott. 
C)  ​a trade association. 
D)  ​a market division.

Question 5

Monopoly power is an extreme amount of market power.​

Accepted Answer

A) True 
 B)False

Question 6

Gas, Inc., and Oil Corporation refine and sell gasoline. To limit the supply of gas on the market and thereby raise prices, Gas and Oil agree to buy "excess" supplies from dealers and "dispose" of it. This is​

Accepted Answer

A)  ​a deal that neither restrains trade or harms competition. 
B)  ​a legal restraint of trade. 
C)  ​a per se violation of the Sherman Act. 
D)  ​subject to analysis under the rule of reason. 
A)  ​a deal that neither restrains trade or harms competition. 
B)  ​a legal restraint of trade. 
C)  ​a per se violation of the Sherman Act. 
D)  ​subject to analysis under the rule of reason.

Question 7

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

Accepted Answer

A)  ​price discrimination. 
B)  ​business judgment. 
C)  ​predatory bidding. 
D)  ​predatory pricing. 
A)  ​price discrimination. 
B)  ​business judgment. 
C)  ​predatory bidding. 
D)  ​predatory pricing.

Question 8

Pump Makers Inc. makes pumps for fire trucks and conditions shipments of its products to Quality Motors Corporation-a maker of fire trucks-on Quality's agreement to buy additional pumps only from Pump Makers. This is​

Accepted Answer

A)  ​an exclusive-dealing contract. 
B)  ​a tying arrangement. 
C)  ​price discrimination. 
D)  ​a group boycott. 
A)  ​an exclusive-dealing contract. 
B)  ​a tying arrangement. 
C)  ​price discrimination. 
D)  ​a group boycott.

Question 9

An antitrust action is brought against Carrier Freight Company, alleging that a certain act constitutes the offense of attempted monopolization. To qualify, the act must have had​

Accepted Answer

A)  ​a dangerous probability of success. 
B)  ​a definite guaranty of success. 
C)  ​a preponderant possibility of success. 
D)  ​a reasonable probability of success. 
A)  ​a dangerous probability of success. 
B)  ​a definite guaranty of success. 
C)  ​a preponderant possibility of success. 
D)  ​a reasonable probability of success.

Question 10

A court deems an agreement between BioTech Inc. and ChemCorp to be a per se violation of the Sherman Act. With respect to this agreement, the court can​

Accepted Answer

A)  ​not determine whether its benefits outweigh its anticompetitive effects. 
B)  ​considers its benefits to the firms' customers. 
C)  ​apply the rule of reason. 
D)  ​review its effect on the relevant market. 
A)  ​not determine whether its benefits outweigh its anticompetitive effects. 
B)  ​considers its benefits to the firms' customers. 
C)  ​apply the rule of reason. 
D)  ​review its effect on the relevant market.

Question 11

A market division by class of customer between rival firms does not violate antitrust law.​

Accepted Answer

A) True 
 B)False

Question 12

The U.S. Department of Justice can prosecute violations of all of the antitrust laws.​

Accepted Answer

A) True 
 B)False

Question 13

It is in society's interest to condemn every firm that acquires a position of power.​

Accepted Answer

A) True 
 B)False

Question 14

An agreement that is deemed a per se violation will be examined by a court to determine whether the agreement actually constitutes a reasonable restraint of trade.​

Accepted Answer

A) True 
 B)False

Question 15

Insurance companies are exempt from antitrust laws whenever state regulation exists.​

Accepted Answer

A) True 
 B)False

Question 16

Disc & Shoe Brakes Corporation, a brake manufacturer, sells its products to Eastside Motors, a retailer, at lower prices than it charges Fast Brake, a competitive retailer. This price discrimination is legal​

Accepted Answer

A)  ​under any circumstances. 
B)  unless its effect is to cause a competitor a loss of any business.​ 
C)  ​unless its effect is to substantially lessen competition. 
D)  ​unless there is no effect on a competitor. 
A)  ​under any circumstances. 
B)  unless its effect is to cause a competitor a loss of any business.​ 
C)  ​unless its effect is to substantially lessen competition. 
D)  ​unless there is no effect on a competitor.

Question 17

Ranchland Supplies Corporation believes that Stock & Equipment Corporation engages in anticompetitive behavior in an attempt to drive Ranchland, its chief competitor, out of the market. Antitrust laws can be enforced against Stock & Equipment by​

Accepted Answer

A)  ​only a disinterested third party. 
B)  ​Congress. 
C)  ​Ranchland. 
D)  ​none of the choices. 
A)  ​only a disinterested third party. 
B)  ​Congress. 
C)  ​Ranchland. 
D)  ​none of the choices.

Question 18

Domestic Oil Company joins with a foreign cartel to control the price of oil. The cartel has a substantial effect on U.S. commerce. A suit for violation of U.S. antitrust laws can be brought against​

Accepted Answer

A)  ​Domestic Oil and the foreign cartel. 
B)  ​the foreign cartel. 
C)  ​Domestic Oil. 
D)  ​all of the choices. 
A)  ​Domestic Oil and the foreign cartel. 
B)  ​the foreign cartel. 
C)  ​Domestic Oil. 
D)  ​all of the choices.

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

Speedee Snoboards, Inc., refuses to sell its products to Timber Mountain WinterSports Stores, Inc., a retail snowboard dealership. This is​

Accepted Answer

A)  ​an exclusive-dealing contract. 
B)  ​a territorial restriction. 
C)  ​attempted monopolization. 
D)  ​a unilateral refusal to deal. 
A)  ​an exclusive-dealing contract. 
B)  ​a territorial restriction. 
C)  ​attempted monopolization. 
D)  ​a unilateral refusal to deal.

Exam 46: Antitrust Law

The purpose of antitrust legislation is to prevent competition.​

Market power is the ability of a firm to enter a given market.​

Friction-Lube Corporation and Grease Inc. are the principal suppliers of their products in their market. They agree that Friction-Lube will sell exclusively to retailers and Grease will sell exclusively to wholesalers. Under antitrust law, this market division is most likely​

Agreements that are deemed per se violations of Section 1 of the Sherman Act include all of the following except​

Monopoly power is an extreme amount of market power.​

Gas, Inc., and Oil Corporation refine and sell gasoline. To limit the supply of gas on the market and thereby raise prices, Gas and Oil agree to buy "excess" supplies from dealers and "dispose" of it. This is​

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

Pump Makers Inc. makes pumps for fire trucks and conditions shipments of its products to Quality Motors Corporation-a maker of fire trucks-on Quality's agreement to buy additional pumps only from Pump Makers. This is​

An antitrust action is brought against Carrier Freight Company, alleging that a certain act constitutes the offense of attempted monopolization. To qualify, the act must have had​

A court deems an agreement between BioTech Inc. and ChemCorp to be a per se violation of the Sherman Act. With respect to this agreement, the court can​

A market division by class of customer between rival firms does not violate antitrust law.​

The U.S. Department of Justice can prosecute violations of all of the antitrust laws.​

It is in society's interest to condemn every firm that acquires a position of power.​

An agreement that is deemed a per se violation will be examined by a court to determine whether the agreement actually constitutes a reasonable restraint of trade.​

Insurance companies are exempt from antitrust laws whenever state regulation exists.​

Disc & Shoe Brakes Corporation, a brake manufacturer, sells its products to Eastside Motors, a retailer, at lower prices than it charges Fast Brake, a competitive retailer. This price discrimination is legal​

Ranchland Supplies Corporation believes that Stock & Equipment Corporation engages in anticompetitive behavior in an attempt to drive Ranchland, its chief competitor, out of the market. Antitrust laws can be enforced against Stock & Equipment by​

Domestic Oil Company joins with a foreign cartel to control the price of oil. The cartel has a substantial effect on U.S. commerce. A suit for violation of U.S. antitrust laws can be brought against​

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

Speedee Snoboards, Inc., refuses to sell its products to Timber Mountain WinterSports Stores, Inc., a retail snowboard dealership. This is​

Law and Legal Reasoning

Courts and Alternative Dispute Resolution

Court Procedures

Business and the Constitution

Business Ethics

Tort Law

Strict Liability and Product Liability

Intellectual Property Rights

Internet Law, Social Media, and Privacy

Criminal Law and Cyber Crime

Nature and Terminology

Agreement in Traditional and E-Contracts

Consideration

Capacity and Legality

Mistakes, Fraud, and Voluntary Consent

The Writing Requirement in Our Digital World

Third Party Rights

Performance and Discharge

Breach of Contract and Remedies

The Formation of Sales and Lease Contracts

Title, Risk, and Insurable Interest

Performance and Breach of Sales and Lease Contracts

Warranties

International and Space Law

Negotiable Instruments

Transferability and Holder in Due Course

Liability, Defenses, and Discharge

Banking in the Digital Age

Creditors Rights and Remedies

Secured Transactions

Bankruptcy Law

Agency Formation and Duties

Agency Liability and Termination

Employment, Immigration, and Labor Law

Employment Discrimination

Small Businesses and Franchises

All Forms of Partnerships

Limited Liability Companies and Special Business Forms

Corporate Formation and Financing

Corporate Directors, Officers, and Shareholders

Mergers and Takeovers

Investor Protection, Insider Trading, and Corporate Governance

Administrative Agencies

Consumer Law

Environmental Protection

Professional Liability and Accountability

Personal Property and Bailments

Real Property and Landlord-Tenant Law

Insurance

Wills and Trusts

The Legal Environment of Business

Torts and Crimes

Contracts and E-Contracts

Domestic and International Sales and Lease Contracts

Negotiable Instruments

Creditors Rights and Bankruptcy

Agency and Employment

Business Organizations

Government Regulation

The purpose of antitrust legislation is to prevent competition.

Market power is the ability of a firm to enter a given market.

Friction-Lube Corporation and Grease Inc. are the principal suppliers of their products in their market. They agree that Friction-Lube will sell exclusively to retailers and Grease will sell exclusively to wholesalers. Under antitrust law, this market division is most likely

Agreements that are deemed per se violations of Section 1 of the Sherman Act include all of the following except

Monopoly power is an extreme amount of market power.

Gas, Inc., and Oil Corporation refine and sell gasoline. To limit the supply of gas on the market and thereby raise prices, Gas and Oil agree to buy "excess" supplies from dealers and "dispose" of it. This is

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

Pump Makers Inc. makes pumps for fire trucks and conditions shipments of its products to Quality Motors Corporation-a maker of fire trucks-on Quality's agreement to buy additional pumps only from Pump Makers. This is

An antitrust action is brought against Carrier Freight Company, alleging that a certain act constitutes the offense of attempted monopolization. To qualify, the act must have had

A court deems an agreement between BioTech Inc. and ChemCorp to be a per se violation of the Sherman Act. With respect to this agreement, the court can

A market division by class of customer between rival firms does not violate antitrust law.

The U.S. Department of Justice can prosecute violations of all of the antitrust laws.

It is in society's interest to condemn every firm that acquires a position of power.

An agreement that is deemed a per se violation will be examined by a court to determine whether the agreement actually constitutes a reasonable restraint of trade.

Insurance companies are exempt from antitrust laws whenever state regulation exists.

Disc & Shoe Brakes Corporation, a brake manufacturer, sells its products to Eastside Motors, a retailer, at lower prices than it charges Fast Brake, a competitive retailer. This price discrimination is legal

Ranchland Supplies Corporation believes that Stock & Equipment Corporation engages in anticompetitive behavior in an attempt to drive Ranchland, its chief competitor, out of the market. Antitrust laws can be enforced against Stock & Equipment by

Domestic Oil Company joins with a foreign cartel to control the price of oil. The cartel has a substantial effect on U.S. commerce. A suit for violation of U.S. antitrust laws can be brought against

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

Speedee Snoboards, Inc., refuses to sell its products to Timber Mountain WinterSports Stores, Inc., a retail snowboard dealership. This is