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Exam 47: Antitrust Law

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Question 31

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"Scuba Gear." Shirley is a popular manufacturer of scuba gear. Before she allows a store to carry her line of scuba gear, she requires that the store owner agree that her line is the only line of scuba gear the store will carry. She also requires that if a store carries her line of scuba gear, it must carry her line of wet suits. Sales of other manufacturer's gear and wet suits have begun a steady decline. She is accused of violating antitrust laws. Shirley, however, replies that she is simply conducting good business practices. Trudy, the president of ABC Scuba, calls Shirley and tells her that she is prepared to bring suit against Shirley for antitrust violations. Shirley tells Trudy that although she is not in violation, that only the government could take action against her, and that the government is way too busy to get involved in a dispute over scuba gear. -The requirement of Shirley that before she will sell scuba gear to a business, the business must carry her line of wet suits is a ______ arrangement.

A) Combination
B) Tying
C) Requirements
D) Complementary
E) Joinder

F) B) and C)
G) D) and E)

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Question 32

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Sheila has a flower shop as does her friend Bob. Their shops are in adjoining towns located approximately 10 miles apart. Sheila agrees that she will not sell flowers for delivery in Bob's town in return for Bob agreeing that he will not sell flowers for delivery in Sheila's town. Have Sheila and Bob committed any antitrust violation, if so what and under what standard would it be reviewed?

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They have violated Section 1 o...

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Question 33

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Which of the following was the result in PepsiCo Inc., v. The Coca-Cola Co., the case in the text in which PepsiCo challenged Coca-Cola's loyalty policy by which independent food distributors (IFDs) agreed to not handle soft drink products of PepsiCo?

Contrast traditional antitrust theories with the Chicago School theories.

Which of the following is true regarding whether Shirley's arrangement that if a store carries her line of scuba gear, it must carry her line of wet suits is legal?

"Scuba Gear." Shirley is a popular manufacturer of scuba gear. Before she allows a store to carry her line of scuba gear, she requires that the store owner agree that her line is the only line of scuba gear the store will carry. She also requires that if a store carries her line of scuba gear, it must carry her line of wet suits. Sales of other manufacturer's gear and wet suits have begun a steady decline. She is accused of violating antitrust laws. Shirley, however, replies that she is simply conducting good business practices. Trudy, the president of ABC Scuba, calls Shirley and tells her that she is prepared to bring suit against Shirley for antitrust violations. Shirley tells Trudy that although she is not in violation, that only the government could take action against her, and that the government is way too busy to get involved in a dispute over scuba gear. -Which of the following is true regarding Shirley's statement that only the government could take action against her?

"Adult Floaters." Bruce and Jimmy are both involved in businesses that manufacture bathing suits for ladies with small personal flotation devices implanted to assist with swimming. They both ship the suits to different states around the country. Bruce and Jimmy get together and decide to raise their prices. They decide that since they are the only two manufacturers of this type of suit, if they both stick together and raise prices to an agreed upon amount, then consumers will be forced to pay that amount. They want to make a lot of money before anyone else jumps into the market. A disgruntled secretary of Bruce finds out about the agreement and sends out letters to consumers revealing it. -What would the government's best argument to the court be regarding the conduct of Bruce and Jimmy?

Which of the following was left the responsibility of identifying which specific behaviors were prohibited under the Sherman Act?

A seller engages in _______ when it sells the same goods to competing buyers for different prices.

Which of the following is false regarding groups and activities that are exempt from antitrust law?

Which of the following is not an example of a horizontal restraint of trade?

Group boycotts by which two or more competing sellers refuse to sell their products to a certain customer are generally per se violations of the Sherman Act.

"Scuba Gear." Shirley is a popular manufacturer of scuba gear. Before she allows a store to carry her line of scuba gear, she requires that the store owner agree that her line is the only line of scuba gear the store will carry. She also requires that if a store carries her line of scuba gear, it must carry her line of wet suits. Sales of other manufacturer's gear and wet suits have begun a steady decline. She is accused of violating antitrust laws. Shirley, however, replies that she is simply conducting good business practices. Trudy, the president of ABC Scuba, calls Shirley and tells her that she is prepared to bring suit against Shirley for antitrust violations. Shirley tells Trudy that although she is not in violation, that only the government could take action against her, and that the government is way too busy to get involved in a dispute over scuba gear. -The agreements between Shirley and sellers to the effect that the stores would only carry Shirley's gear are ______ contracts.

The Sherman Act may not be constitutionally applied to foreign companies that conduct business in the U.S.

Which of the following prohibits price discrimination by sellers?

Which of the following references the type of merger that occurs when an acquiring firm desires to spread into a new market where it does not have a product, merges with a firm in that market, and continues to produce the other firm's product in the target market?

Bid rigging is legal because it has recently been removed from the category of price-fixing.

"Scuba Gear." Shirley is a popular manufacturer of scuba gear. Before she allows a store to carry her line of scuba gear, she requires that the store owner agree that her line is the only line of scuba gear the store will carry. She also requires that if a store carries her line of scuba gear, it must carry her line of wet suits. Sales of other manufacturer's gear and wet suits have begun a steady decline. She is accused of violating antitrust laws. Shirley, however, replies that she is simply conducting good business practices. Trudy, the president of ABC Scuba, calls Shirley and tells her that she is prepared to bring suit against Shirley for antitrust violations. Shirley tells Trudy that although she is not in violation, that only the government could take action against her, and that the government is way too busy to get involved in a dispute over scuba gear. -Which of the following is true regarding the contention of Shirley that her agreements with sellers to the effect that the sellers will only carry her scuba gear are good business practices and legal?

Which of the following references the type of conglomerate merger that occurs when a firm attempts to extend the market for one of its current products by merging with a firm already active in the target market?

"Adult Floaters." Bruce and Jimmy are both involved in businesses that manufacture bathing suits for ladies with small personal flotation devices implanted to assist with swimming. They both ship the suits to different states around the country. Bruce and Jimmy get together and decide to raise their prices. They decide that since they are the only two manufacturers of this type of suit, if they both stick together and raise prices to an agreed upon amount, then consumers will be forced to pay that amount. They want to make a lot of money before anyone else jumps into the market. A disgruntled secretary of Bruce finds out about the agreement and sends out letters to consumers revealing it. -In attempting to establish a violation of the Sherman Act, what type of trade violation would the government most likely allege?