Question 1

What led to the enactment of the Sherman Act in 1890?

Accepted Answer

During its first hundred years, the fede

Question 2

Which of the following types of businesses enjoys a statutory exemption from the Sherman Act?

Accepted Answer

A)  Insurance companies 
B)  Pharmaceutical companies 
C)  Educational institutions 
D)  Software companies 
E)  Consumer products companies 
A)  Insurance companies 
B)  Pharmaceutical companies 
C)  Educational institutions 
D)  Software companies 
E)  Consumer products companies

Question 3

For a seller's pricing to be considered predatory conduct, there must be proof that:

Accepted Answer

A)  the seller was selling the product at a price below the cost price. 
B)  the prices were intended to drive competitors out of business followed by the wrongdoer recouping these initial losses. 
C)  the prices were significantly lower than those of all competitors within the same product group. 
D)  the buyers were unwilling to buy the product at the seller's prices, and only bought the product from a lack of choice. 
E)  the buyer had other options in the same product line available in different price ranges. 
A)  the seller was selling the product at a price below the cost price. 
B)  the prices were intended to drive competitors out of business followed by the wrongdoer recouping these initial losses. 
C)  the prices were significantly lower than those of all competitors within the same product group. 
D)  the buyers were unwilling to buy the product at the seller's prices, and only bought the product from a lack of choice. 
E)  the buyer had other options in the same product line available in different price ranges.

Question 4

Resale price maintenance is legal only if there is no coercion or pressure other than the announced policy and its implementation.

Accepted Answer

A) True 
 B)False

Question 5

Violations of the original Clayton Act were crimes, and the act contained sanctions for forfeiture of property.

Accepted Answer

A) True 
 B)False

Question 6

Name and discuss the four different types of mergers.

Accepted Answer

Horizontal mergers generally combine two

Question 7

Regarding price fixing, which of the following is a correct statement?

Accepted Answer

A)  Ethical standards may be used to fix prices, in which case, the price fixing is not subject to the Sherman Act. 
B)  It is legal for competitors to fix a low price if the consumer ultimately benefits. 
C)  Attempts by manufacturers to control the ultimate sale of their product are analyzed under the per se illegality. 
D)  The exchange of price information among creditors is a violation of the Sherman Act. 
E)  Cooperation and cosy relationships between competitors cannot be termed illegal. 
A)  Ethical standards may be used to fix prices, in which case, the price fixing is not subject to the Sherman Act. 
B)  It is legal for competitors to fix a low price if the consumer ultimately benefits. 
C)  Attempts by manufacturers to control the ultimate sale of their product are analyzed under the per se illegality. 
D)  The exchange of price information among creditors is a violation of the Sherman Act. 
E)  Cooperation and cosy relationships between competitors cannot be termed illegal.

Question 8

Which of the following was established by the Noerr-Pennington doctrine?

Accepted Answer

A)  Concerted efforts to lobby government officials, regardless of the anticompetitive purposes of the lobbying effort are exempt from the provisions of the Sherman Act. 
B)  When a state acts in its sovereign capacity, it is immune from federal antitrust scrutiny. 
C)  Price fixing is illegal whether the parties to it have control of the market or not and whether or not they are trying to raise or lower the market price. 
D)  Resale price maintenance is legal only if there is no coercion or pressure other than the announced policy and its implementation. 
E)  Conduct directed at price stabilization is per se anticompetitive. 
A)  Concerted efforts to lobby government officials, regardless of the anticompetitive purposes of the lobbying effort are exempt from the provisions of the Sherman Act. 
B)  When a state acts in its sovereign capacity, it is immune from federal antitrust scrutiny. 
C)  Price fixing is illegal whether the parties to it have control of the market or not and whether or not they are trying to raise or lower the market price. 
D)  Resale price maintenance is legal only if there is no coercion or pressure other than the announced policy and its implementation. 
E)  Conduct directed at price stabilization is per se anticompetitive.

Question 9

In full-line forcing, the buyer is forced to purchase only one product of the line.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following statements holds true for monopoly power?

Accepted Answer

A)  Mere possession of monopoly power violates Section 1 of the Sherman Act. 
B)  Monopoly power "thrust upon" a firm violates Section 2 of the Sherman Act. 
C)  Monopoly power which exists because of a patent or franchise violates the Clayton Act. 
D)  If the firm engages in conduct that has the effect of extending the monopoly power, it does not violate the Sherman Act. 
E)  Proof of monopoly power is insufficient to qualify as a violation of the Sherman Act. 
A)  Mere possession of monopoly power violates Section 1 of the Sherman Act. 
B)  Monopoly power "thrust upon" a firm violates Section 2 of the Sherman Act. 
C)  Monopoly power which exists because of a patent or franchise violates the Clayton Act. 
D)  If the firm engages in conduct that has the effect of extending the monopoly power, it does not violate the Sherman Act. 
E)  Proof of monopoly power is insufficient to qualify as a violation of the Sherman Act.

Question 11

The person who holds legal title to trust property for the benefit of another is the:

Accepted Answer

A)  beneficiary. 
B)  bailor. 
C)  bailee 
D)  benefactor. 
E)  trustee. 
A)  beneficiary. 
B)  bailor. 
C)  bailee 
D)  benefactor. 
E)  trustee.

Question 12

The purpose of the Sherman Act was to:

Accepted Answer

A)  legalize monopolies. 
B)  preserve competition. 
C)  create trusts. 
D)  restrict competition. 
E)  legalize trusts. 
A)  legalize monopolies. 
B)  preserve competition. 
C)  create trusts. 
D)  restrict competition. 
E)  legalize trusts.

Question 13

The Colgate Doctrine allows:

Accepted Answer

A)  resale price maintenance even under coercion. 
B)  a franchisor to require that franchisees purchase all of its equipment and inventory from them. 
C)  the FTC to regulate unfair and deceptive acts or practices in commerce. 
D)  natural monopolies to exist outside of Sherman Act jurisdiction. 
E)  manufacturers to set a price and refuse to deal with those that won't comply. 
A)  resale price maintenance even under coercion. 
B)  a franchisor to require that franchisees purchase all of its equipment and inventory from them. 
C)  the FTC to regulate unfair and deceptive acts or practices in commerce. 
D)  natural monopolies to exist outside of Sherman Act jurisdiction. 
E)  manufacturers to set a price and refuse to deal with those that won't comply.

Question 14

The Celler-Kefauver amendment that plugged the stock versus asset loophole in the Clayton Act applies to:

Accepted Answer

A)  only corporations. 
B)  only partnerships. 
C)  corporations and partnerships. 
D)  corporations, partnerships and sole proprietorships. 
E)  only sole proprietorships. 
A)  only corporations. 
B)  only partnerships. 
C)  corporations and partnerships. 
D)  corporations, partnerships and sole proprietorships. 
E)  only sole proprietorships.

Question 15

The Department of Justice alone has the power to bring criminal proceedings in cases of violations of antitrust laws.

Accepted Answer

A) True 
 B)False

Question 16

According to the per se rule, price fixing is illegal only when the parties have control of the market.

Accepted Answer

A) True 
 B)False

Question 17

What is per se illegality and how is it applied?

Accepted Answer

Per se illegality occurs when competitor

Question 18

Explain the provision of triple-damage in section 4 of the Clayton Act.

Accepted Answer

The Sherman Act as amended by the Clayto

Question 19

Which of the following is true of the Clayton Act?

Accepted Answer

A)  The original Clayton Act contained no sanction for forfeiture of property. 
B)  Organizations injured by a violation could obtain injunctive relief, but individuals could not. 
C)  Enumerated practices have to actually injure competition to be wrongful. 
D)  The burden of proving a violation was left to the plaintiff or victim. 
E)  No action could be taken unless a monopolistic practice substantially affected existing competitors. 
A)  The original Clayton Act contained no sanction for forfeiture of property. 
B)  Organizations injured by a violation could obtain injunctive relief, but individuals could not. 
C)  Enumerated practices have to actually injure competition to be wrongful. 
D)  The burden of proving a violation was left to the plaintiff or victim. 
E)  No action could be taken unless a monopolistic practice substantially affected existing competitors.

Question 20

The Federal Trade Commission is tasked with determining whether unfair methods of competition exist but the Commission is not empowered to issue trade rules and guides.

Accepted Answer

A) True 
 B)False

Exam 16: Regulating Competition_Antitrust Laws

What led to the enactment of the Sherman Act in 1890?

Which of the following types of businesses enjoys a statutory exemption from the Sherman Act?

For a seller's pricing to be considered predatory conduct, there must be proof that:

Resale price maintenance is legal only if there is no coercion or pressure other than the announced policy and its implementation.

Violations of the original Clayton Act were crimes, and the act contained sanctions for forfeiture of property.

Name and discuss the four different types of mergers.

Regarding price fixing, which of the following is a correct statement?

Which of the following was established by the Noerr-Pennington doctrine?

In full-line forcing, the buyer is forced to purchase only one product of the line.

Which of the following statements holds true for monopoly power?

The person who holds legal title to trust property for the benefit of another is the:

The purpose of the Sherman Act was to:

The Colgate Doctrine allows:

The Celler-Kefauver amendment that plugged the stock versus asset loophole in the Clayton Act applies to:

The Department of Justice alone has the power to bring criminal proceedings in cases of violations of antitrust laws.

According to the per se rule, price fixing is illegal only when the parties have control of the market.

What is per se illegality and how is it applied?

Explain the provision of triple-damage in section 4 of the Clayton Act.

Which of the following is true of the Clayton Act?

The Federal Trade Commission is tasked with determining whether unfair methods of competition exist but the Commission is not empowered to issue trade rules and guides.

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