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Exam 23: Antitrust Law and Promoting Competition

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Question 21

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An agreement between firms operating at different levels in the manufacturing and distribution process cannot violate antitrust law.

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Question 22

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Gulf Air,Inc.,is the major wholesale distributor of software in the state of Florida.Its closest competitor is Fluid Systems Company,another Florida firm.The two firms agree that Gulf Air will operate in south Florida and Fluid Systems will operate in north Florida.This is

A) a group boycott.
B) a market division.
C) a joint venture.
D) an exclusive-dealing contract.

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Question 23

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Lightning Cycles,Inc.,makes Lightning-brand motorcycles and accessories,which are distributed to authorized dealers,including Macho Motors,Inc.Macho operates dealerships in several locations.Lightning imposes territorial restrictions on Macho to insulate other dealers from direct competition.This is

A market in which there is more than one seller,even if only a limited number,cannot be a monopoly.

Minimum resale price maintenance agreements are subject to analysis under the rule of reason.

International Software,Inc.,conditions the sale of one of its products on Nationwide Office System's agreeing to buy another of International's products.This deal is

To violate antitrust law,an activity must involve two or more persons.

A market division by class of customer between rival firms violates antitrust law.

To drive its competitors out of a certain geographic segment of its market,Fryin' Potatoes,Inc.,sets the prices of its products below cost for the buyers in that area.This is

Conditioning the sale of one product on the purchase of another is a tying arrangement.

Midwest Agri-Products Corporation offers to sell its sugar substitute to Nice Candies,Inc.,only if Nice Candies agrees to buy all the corn it needs from Midwest Agri-Products,even though there are other corn sellers from whom Nice Candies could buy.This is

U.S.firms may be subject to other nations' antitrust laws.

A firm can have market power without violating antitrust law.

Spa Selectiva Company makes and sells beauty salon supplies.By selling its product at prices substantially below the normal cost of production,Spa Selectiva hopes to drive its competitors from the market.This is

Tasty Eatin' Corporation merges with Hasty Burgers,Inc.This merger between firms that compete with each other in the same market is

Fresh Vegetables,Inc.,a wholesaler,refuses to sell its produce to Good Mart Stores,Inc.,a retailer.Under the Sherman Act,this is

North Mining Company and South Excavation Company agree to abide by the decisions of East Coast Financial Corporation as to their respective levels of production,markets,and prices,effectively reducing competition and increasing profits.This is most likely

U.S.antitrust law may protect foreign consumers and competitors from violations by U.S.firms.

HVAC Parts Company charges different buyers different prices for identical goods.HVAC's prices are subject to evaluation under

A unilateral refusal to deal with a specific party is never a violation of antitrust law.