Multiple Choice Questions
- Are horizontal price fixing and vertical price fixing per se violations of the Sherman Act?
(a) Yes/Yes
(b) Yes/No
(c) No/Yes
(d) No/No
Answer: B.
- If Sterling Steel refused to buy concrete from Carat Concrete unless CC bought steel from SS would that refusal to deal be a violation of antitrust laws?
(a) Yes, a per se violation
(b) It used to be a violation but is no longer
(c) Yes, if the competitive impact is highly significant.
(d) Yes, if SS has a monopoly.
Answer: C.
- Reserve Supply Corp., a cooperative of 379 lumber dealers, charged that Owens-Corning Fiberglass Corp. violated the Robinson-Patman Act by selling at lower prices to Reserve’s competitors. It presented proof that these prices had harmed competition. Owens-Corning admitted that it had granted lower prices to a number of Reserve’s competitors to meet, but not beat, the prices of other insulation manufacturers. Is Owens-Corning in violation of the Robinson-Patman Act?
(a) Yes, because the RPA requires that manufacturers charge all customers the same price.
(b) Yes, because any violation of the RPA is per se.
(c) Yes, because these price variations harmed competition.
(d) No, because a manufacturer is not liable under the RPA if it charges lower prices to meet competition. .
Answer: D.
- Oftentimes, if one airline lowers its prices on a particular route, so will all of the others. What is this type of activity called and is it a violation of the antitrust laws?
(a) Refusal to deal/ it is a rule of reason violation
(b) Conscious parallelism/it is not a violation by itself
(c) Price discrimination/it is a per se violation
(d) Resale price maintenance/ it is a rule of reason violation
Answer: B.
- A horizontal merger is illegal if:
(a) The resulting company controls at least 90% of the market
(b) The resulting company controls at least 50% of the market
(c) The resulting company has the ability to exclude competitors
(d) The resulting company has assets of $131.9 million or higher.
Answer: C.