Question 1

How would a plaintiff establish the existence of a tying arrangement,and under what laws may tying arrangements be challenged?

Accepted Answer

To establish a tying arrangement,a plain

Question 2

Which of the following is NOT a factor used in determining the anticompetitive effects of a horizontal merger under the Clayton Act?

Accepted Answer

A)  The level of concentration in the market 
B)  The market shares of the firms involved in the transaction 
C)  Whether the market is structurally conducive to anticompetitive behavior 
D)  The market price of the buyer's stock 
A)  The level of concentration in the market 
B)  The market shares of the firms involved in the transaction 
C)  Whether the market is structurally conducive to anticompetitive behavior 
D)  The market price of the buyer's stock

Question 3

Horizontal agreements among competitors to avoid competition on nonprice matters cannot be a violation of Section 1 of the Sherman Act.

Accepted Answer

A) True 
 B)False

Question 4

The Federal Trade Commission,an independent administrative agency,has the exclusive power to enforce the Federal Trade Commission Act,which is broader than the other antitrust laws.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is an approach to analyzing the reasonableness of a restraint of trade?

Accepted Answer

A)  Totality rule 
B)  Per se rule 
C)  Rule of reason 
D)  Both the per se rule and the rule of reason 
A)  Totality rule 
B)  Per se rule 
C)  Rule of reason 
D)  Both the per se rule and the rule of reason

Question 6

Showing that ostensibly independent firms consistently set prices at the same levels and change prices at the same time in an attempt to conspire horizontally is known as:

Accepted Answer

A)  conscious parallelism. 
B)  intrabrand competition. 
C)  tying arrangements. 
D)  predatory pricing. 
A)  conscious parallelism. 
B)  intrabrand competition. 
C)  tying arrangements. 
D)  predatory pricing.

Question 7

The Sherman Act applies only to "trade or commerce" within a state,between the states,or with foreign nations.​

Accepted Answer

A) True 
 B)False

Question 8

Firms can incur liability under Section 2 of the Sherman Act by acquiring or maintaining monopoly power through corporate mergers or acquisitions.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is a component of a market?

Accepted Answer

A)  A product component 
B)  A geographic component 
C)  A defined component 
D)  Both a product component and a geographic component 
A)  A product component 
B)  A geographic component 
C)  A defined component 
D)  Both a product component and a geographic component

Question 10

Under which of the following situations will courts usually find pricing legal?

Accepted Answer

A)  When the prices are above average variable cost but below average total cost and the company has excess capacity. 
B)  When the prices are above average variable cost but below average total cost and the company does not have excess capacity. 
C)  When the prices are below average variable cost and below average total cost and the company does not have excess capacity. 
D)  Only when prices are above both average variable cost and average total cost. 
A)  When the prices are above average variable cost but below average total cost and the company has excess capacity. 
B)  When the prices are above average variable cost but below average total cost and the company does not have excess capacity. 
C)  When the prices are below average variable cost and below average total cost and the company does not have excess capacity. 
D)  Only when prices are above both average variable cost and average total cost.

Question 11

Which of the following best describes the objective of the rule of reason rule?

Accepted Answer

A)  To determine whether the requirements of the per se rule have been satisfied 
B)  To determine whether,on balance,the activity at issue promotes or restrains competition 
C)  To determine whether in a particular situation a horizontal price fixing has actually harmed consumers 
D)  To determine whether providers of a good acted reasonably in engaging in a boycott 
A)  To determine whether the requirements of the per se rule have been satisfied 
B)  To determine whether,on balance,the activity at issue promotes or restrains competition 
C)  To determine whether in a particular situation a horizontal price fixing has actually harmed consumers 
D)  To determine whether providers of a good acted reasonably in engaging in a boycott

Question 12

In CASE 16.1 Leegin Creative Leather Products,Inc.v.PSKS,Inc.(2007),Leegin instituted a retail pricing and promotion policy and refused to sell to retailers that discounted Brighton goods below Leegin's suggested retail prices.PSKS sued Leegin,alleging that Leegin had violated the antitrust laws by "enter[ing] into agreements with retailers to charge only those prices fixed by Leegin." The court agreed with PSKS that it is per se illegal for a manufacturer to agree with its distributor to set the minimum price that the distributor can charge for the manufacturer's goods.The appeal of this decision involved a question of whether _____ should be analyzed under the _____.

Accepted Answer

A)  resale price maintenance agreements; rule of reason 
B)  a horizontal conspiracy; per se rule 
C)  conglomerate mergers; per se rule 
D)  a vertical conspiracy; rule of reason 
A)  resale price maintenance agreements; rule of reason 
B)  a horizontal conspiracy; per se rule 
C)  conglomerate mergers; per se rule 
D)  a vertical conspiracy; rule of reason

Question 13

A manufacturer that sells its goods both wholesale and at retail is called a(n):

Accepted Answer

A)  conglomerate merger. 
B)  dual distributor. 
C)  essential facility. 
D)  franchise. 
A)  conglomerate merger. 
B)  dual distributor. 
C)  essential facility. 
D)  franchise.

Question 14

Which of the following is a tenet of the Chicago School's economic thought?

Accepted Answer

A)  Attempts at regulation often actually decrease the competitiveness of markets. 
B)  The efficacy of the government's regulation of commerce and markets is unquestionable. 
C)  The number of truly per se violations of the antitrust laws is masked by the Sherman Act. 
D)  Market forces are seldom sufficient to defeat most anticompetitive practices. 
A)  Attempts at regulation often actually decrease the competitiveness of markets. 
B)  The efficacy of the government's regulation of commerce and markets is unquestionable. 
C)  The number of truly per se violations of the antitrust laws is masked by the Sherman Act. 
D)  Market forces are seldom sufficient to defeat most anticompetitive practices.

Question 15

Which of the following is true regarding enforcement under the antitrust laws?

Accepted Answer

A)  The U.S.Department of Justice and the Federal Trade Commission act as enforcement agents for the federal antitrust laws. 
B)  Only the U.S.Department of Justice acts as an enforcement agent for the federal antitrust laws. 
C)  Only the Federal Trade Commission acts as an enforcement agent for the federal antitrust laws. 
D)  The U.S.Department of Justice and the Consumer Fairness Commission act as enforcement agents for the federal antitrust laws. 
A)  The U.S.Department of Justice and the Federal Trade Commission act as enforcement agents for the federal antitrust laws. 
B)  Only the U.S.Department of Justice acts as an enforcement agent for the federal antitrust laws. 
C)  Only the Federal Trade Commission acts as an enforcement agent for the federal antitrust laws. 
D)  The U.S.Department of Justice and the Consumer Fairness Commission act as enforcement agents for the federal antitrust laws.

Question 16

A(n)__________ is made up of product or service offerings by different manufacturers or sellers that are economically interchangeable and may therefore be said to compete.

Accepted Answer

A)  interchangeable-brand product market 
B)  market power interchange 
C)  multiple-brand product market 
D)  consumer surplus brand market 
A)  interchangeable-brand product market 
B)  market power interchange 
C)  multiple-brand product market 
D)  consumer surplus brand market

Question 17

The per se ban on horizontal market division extends to:

Accepted Answer

A)  conglomeration activity. 
B)  both potential and actual competitors. 
C)  setting of prices only. 
D)  The per se rule is not applicable in horizontal market division. 
A)  conglomeration activity. 
B)  both potential and actual competitors. 
C)  setting of prices only. 
D)  The per se rule is not applicable in horizontal market division.

Question 18

The principal European Union rules concerning competition are set forth in Articles 101 and 102 of the:

Accepted Answer

A)  Treaty on the Functioning of the European Union (TFEU). 
B)  European Commission. 
C)  Paris Agreement. 
D)  Global Compact. 
A)  Treaty on the Functioning of the European Union (TFEU). 
B)  European Commission. 
C)  Paris Agreement. 
D)  Global Compact.

Question 19

__________ competition is competition between companies producing the same type of product.

Accepted Answer

A)  Intrabrand 
B)  Interbrand 
C)  Vertical 
D)  Oriented 
A)  Intrabrand 
B)  Interbrand 
C)  Vertical 
D)  Oriented

Question 20

The courts will not require evidence of an explicit agreement to violate the law against horizontal arrangements that restrain trade.

Accepted Answer

A) True 
 B)False

Exam 16: Antitrust

How would a plaintiff establish the existence of a tying arrangement,and under what laws may tying arrangements be challenged?

Which of the following is NOT a factor used in determining the anticompetitive effects of a horizontal merger under the Clayton Act?

Horizontal agreements among competitors to avoid competition on nonprice matters cannot be a violation of Section 1 of the Sherman Act.

The Federal Trade Commission,an independent administrative agency,has the exclusive power to enforce the Federal Trade Commission Act,which is broader than the other antitrust laws.

Which of the following is an approach to analyzing the reasonableness of a restraint of trade?

Showing that ostensibly independent firms consistently set prices at the same levels and change prices at the same time in an attempt to conspire horizontally is known as:

The Sherman Act applies only to "trade or commerce" within a state,between the states,or with foreign nations.​

Firms can incur liability under Section 2 of the Sherman Act by acquiring or maintaining monopoly power through corporate mergers or acquisitions.

Which of the following is a component of a market?

Under which of the following situations will courts usually find pricing legal?

Which of the following best describes the objective of the rule of reason rule?

A manufacturer that sells its goods both wholesale and at retail is called a(n):

Which of the following is a tenet of the Chicago School's economic thought?

Which of the following is true regarding enforcement under the antitrust laws?

A(n)__________ is made up of product or service offerings by different manufacturers or sellers that are economically interchangeable and may therefore be said to compete.

The per se ban on horizontal market division extends to:

The principal European Union rules concerning competition are set forth in Articles 101 and 102 of the:

__________ competition is competition between companies producing the same type of product.

The courts will not require evidence of an explicit agreement to violate the law against horizontal arrangements that restrain trade.

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The Sherman Act applies only to "trade or commerce" within a state,between the states,or with foreign nations.