Deck 14: Business Competition: Antitrust

Question 1

The interstate commerce jurisdictional standard for the Sherman Act requires proof of transactions across state lines.

Answer 1

False

Question 2

Predatory pricing below cost with monopoly poweris illegal.

Answer 2

True

Question 3

Competition restraints in commercial leases are generally valid.

Answer 3

True

Question 4

Predatory pricing is pricing below actual cost.

Question 5

Covenants not to compete cannot be used in agreements for the sale of businesses.

Question 6

Monopoly power is the power to control prices or exclude competition.

Question 7

The Sherman Act imposes fines and imprisonment for violations.

Question 8

Cross-elasticity of demand is irrelevant in determining the product market.

Question 9

Setting minimum prices is a per se violation of the Sherman Act.

Question 10

The Clayton Act provides for treble damage recovery for all antitrust violations.

Question 11

Section 1 of the Sherman Act covers monopolization.

Question 12

Only Clayton Act violations carry treble damages.

Question 13

The Antitrust Improvements Act gave the Justice Department broader investigative authority.

Question 14

The Sherman Act does not apply unless sales across state lines are involved.

Question 15

Generally,joint ventures among competitors in international business are per se violations of the Sherman Act.

Question 16

Equitable remedies are not available under the Sherman Act.

Question 17

Covenants not to compete are illegal per se.

Question 18

The Robinson-Patman Act deals with price discrimination.

Question 19

The Clayton Act does not carry criminal penalties.

Question 20

The Celler-Kefauver Act regulates asset acquisitions.

Question 21

The Celler-Kefauver Act is part of the Clayton Act.

Question 22

The tying product is the desired product.

Question 23

Customer and territorial restrictions are per se antitrust violations.

Question 24

Group boycotts are per se violations.

Question 25

Conscious parallelism is a per se violation under the Sherman Act.

Question 26

An agreement among competitors for elimination of bidding is a violation of federal antitrust laws.

Question 27

Division of markets is a per se violation.

Question 28

Fair trade laws are still in effect in many states.

Question 29

Price control consignments are treated as forms of resale price maintenance.

Question 30

Private parties can bring suit under the Federal Trade Commission Act.

Question 31

The Noerr-Pennington doctrine is an antitrust exception that originates in the First Amendment.

Question 32

Joint ventures among competitors are per se violations.

Question 33

The failing company doctrine is an exception to horizontal merger restrictions.

Question 34

Exclusive distributorships are per se antitrust violations.

Question 35

Monopolization is a vertical restraint of trade.

Question 36

Resale price maintenance is a per se violation of the Sherman Act.

Question 37

Setting maximum prices is a per se violation of the Sherman Act.

Question 38

Tying arrangements are per se antitrust violations.

Question 39

Limitations on bidding are permitted in professional bids such as in architecture and service contracts.

Question 40

Resale price maintenance is a vertical restraint of trade.

Question 41

A tying arrangement requires the seller to have market power in the tied product.

Question 42

Meeting the competition is a defense to price discrimination.

Question 43

Interlocking directorates tend to be efficient,effective,ethical,and legal.

Question 44

The legality of vertical mergers is determined by the relevant geographic and product markets.

Question 45

A covenant in the sale of a dry cleaning business that prohibits the seller from operating a dry cleaning business anywhere in that state is too restrictive to be enforced.

Question 46

There is no price discrimination when lower prices are charged for generic label cans of the same product.

Question 47

An agreement among competitors to control the supply of their products to the market violates the Sherman Act.

Question 48

Quantity discounts violate the Robinson-Patman Act.

Question 49

Refusals to deal are a per se violation of the Sherman Act.

Question 50

A defense to tying is quality control.

Question 51

Generic brands can carry a lesser price than brand-name products even though identical in composition without experiencing price discrimination difficulties.

Question 52

A tying arrangement requires the seller to have market power in the tying product.

Question 53

Corporate officers are not liable for violations of the Sherman Act.

Question 54

A boycott against subcontractors who are cheaper because of safety concerns is still an illegal group boycott.

Question 55

Requiring a franchisee to use trademark napkins is a per se antitrust violation.

Question 56

Meeting the competition is a defense to price discrimination.

Question 57

Sole outlets are not antitrust violations when there is interbrand competition.

Question 58

Exclusive dealing contracts are per se violations.

Question 59

A covenant not to compete in a contract for the sale of a business protects the goodwill of the existing business for the buyer.

Question 60

A vertical merger that prevents market entry is illegal.

Question 61

Cross-elasticity of demand is:

A)the willingness to substitute other products.
B)a factor in determining resale price maintenance.
C)a factor in determining the geographic market.
D)all of the above

Question 62

Which of the following is not regulated by the Clayton Act?

A)interlocking directorates
B)mergers
C)tying sales
D)monopolization
E)All of the above are regulated by the Clayton Act.

Question 63

The Antitrust Modernization Commissionproposed material changes in the antitrust laws to accommodate e-commerce market changes.

Question 64

Which of the following is not required for an enforceable covenant not to compete?

A)sale of a business
B)reasonable geographic scope
C)reasonable time limits
D)All of the above are required.

Question 65

There is hardly any cross-elasticity in the gasoline market.

Question 66

A monopsony is the same thing as a monopoly.

Question 67

In Weyerhaeuser v.Ross-Simmons,Weyerhaeuser was found liable for:

A)predatory bidding.
B)predatory pricing.
C)nothing.
D)monopsony violations.

Question 68

Superior skill,foresight,and industry is a:

A)justification for a monopoly.
B)defense to a vertical restraint.
C)defense to predatory pricing.
D)all of the above

Question 69

A monopsony is illegal per se.

Question 70

Treble damages are recoverable for actions brought under:

A)the Sherman Act.
B)the FTC Act.
C)the Antitrust Improvements Act.
D)all of the above

Question 71

The ability of a customer to control the prices of a supplier in a market is a monopsony.

Question 72

Market power is:

A)represented by a relatively inelastic demand curve.
B)defined by statute.
C)the same as market share above 50 percent.
D)all of the above

Question 73

Gringo's Restaurant is a small restaurant located in a Mesa,Arizona,neighborhood shopping center that has a grocery store (chain)as its anchor tenant.Carl Williams owns Gringo's and has just negotiated its sale to Wilma Freestone.The covenant not to compete provides that Williams will not open a competing restaurant anywhere within a two-mile radius of Gringo's for a period of two years.The noncompete covenant is:

A)too restrictive and is a violation of the Sherman Act.
B)not subject to review so long as it is part of the sales contract.
C)probably reasonable and enforceable.
D)void

Question 74

Which of the following acts prohibits unfair methods of competition?

A)Sherman Act
B)Federal Trade Commission Act
C)Robinson-Patman Act
D)Clayton Act
E)none of the above

Question 75

The Celler-Kefauver Act:

A)is an amendment to the Clayton Act.
B)regulates mergers.
C)is the Antitrust Improvements Act.
D)none of the above

Question 76

The judicial approach to antitrust cases is one of weighing benefits to competition.

Question 77

Which act contains prohibitions on monopolization?

A)Sherman Act
B)Clayton Act
C)Robinson-Patman Act
D)Celler-Kefauver Act
E)none of the above

Question 78

Manufacturers who refuse to deal with retailers who do not charge a suggested retail price have committed a per se violation of the antitrust laws.

Question 79

Which of the following is not a per se violation of the antitrust laws?

A)price fixing.
B)group boycotts.
C)predatory pricing.
D)division of markets.
E)All of the above are per se violations.

Question 80

Manufacturers who refuse to deal with discount houses have committed a per se violation of the antitrust laws.