Question 1

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.

Question 2

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.

Question 3

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

Accepted Answer

A) True 
 B)False

Question 4

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.

Question 5

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.

Question 6

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.

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

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 9

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.

Question 10

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.

Question 11

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.

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A) True 
 B)False

Question 14

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.

Question 15

The purpose of antitrust legislation is to prevent competition.​

Accepted Answer

A) True 
 B)False

Question 16

Monopoly power is an extreme amount of market power.​

Accepted Answer

A) True 
 B)False

Question 17

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.

Question 18

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.

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 46: Antitrust Law

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​

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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.​

Correct AnswerverifiedShow Answer

The purpose of antitrust legislation is to prevent competition.​

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Monopoly power is an extreme amount of market power.​

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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​

Correct AnswerverifiedShow Answer

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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.

Correct Answer
verified

The purpose of antitrust legislation is to prevent competition.

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

Monopoly power is an extreme amount of market power.

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified