Question 1

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

Accepted Answer

Price differentials are allowed under the Robinson-Patman Act when they result from changing market conditions, avoiding obsolescence of seasonal merchandise, including perishables, or closing out sales.

Question 2

Vertical price fixing refers to

Accepted Answer

The answer of Vertical price fixing refers to
...

Question 3

Resale price maintenance was declared illegal in 1975 under the

Accepted Answer

The answer of Resale price maintenance was declared illegal in...

Question 4

Vertical price fixing involves controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price.This practice is also called __________.

Accepted Answer

Vertical price fixing, which involves setting minimum retail prices for products, is also known as resale price maintenance.

Question 5

practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Accepted Answer

Price discrimination is the practice of charging different prices to different buyers for goods of like grade and quality. It is illegal only if it harms competition or creates a monopoly.

Question 6

Johnson,the manager of a discount consumer electronics store,was approached by the manufacturer's representative on behalf of a marketer of a popular and profitable line of DVD storage racks.The manufacturer's representative implied that if Johnson doesn't raise the retail prices for the storage racks to those paid by the marketer's non-discount customers,Johnson's supply of racks may be severely curtailed.The manufacturer's representative is guilty of attempting

Accepted Answer

The manufacturer's representative is attempting to enforce a resale price maintenance policy by pressurizing the store manager to increase the retail prices to match those paid by non-discount customers. This is illegal because it limits price competition and can lead to monopolistic practices.

Question 7

Price discrimination is illegal under the

Accepted Answer

Price discrimination is illegal under the Robinson-Patman Act which prohibits a seller from charging different prices to different buyers for the same product, unless the price difference is based on differences in the cost of manufacture, sale, or delivery.

Question 8

Price discrimination refers to

Accepted Answer

Price discrimination refers to the practice of charging different prices to different buyers for goods of like grade and quality. This is often used by businesses to increase profits by charging higher prices to customers who are willing to pay more, while also offering lower prices to attract customers who may not be able to afford the higher price point.

Question 9

Robinson-Patman Act covers promotional allowances as well as discounts.To legally offer promotional allowances to buyers,the seller must do so on a(n)__________ to all buyers businesses distributing the seller's products.

Accepted Answer

The Robinson-Patman Act requires that promotional allowances be offered on a proportionally equal basis to all buyers distributing the seller's products. This means that the allowances must be offered based on the same percentage or amount to all buyers, regardless of their size or geographic location. Offering promotional allowances on a limited, disproportionate, or geographical basis would be a violation of the Act. "Across the board" is a vague term and doesn't accurately describe the requirement for proportional equality.

Question 10

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

Accepted Answer

The Robinson-Patman Act allows price differentials if they are made in good faith to meet a competitor's price, as long as they are not intended to harm competition.

Question 11

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

Accepted Answer

The Robinson-Patman Act allows for price differentials as long as they do not exceed the cost differences resulting from different methods or quantities of sale or delivery. Option A specifies this condition, making it a permitted practice under the Act. Option B is not allowed as it discriminates on the basis of family affiliation. Option C could be allowed if the price differential is based on differences in quality or grade. Option D is not allowed as it discriminates on the basis of religion. Option E is not relevant to the conditions specified by the Act.

Question 12

Figure 14-8
-Consider Figure 14-8 above."D" represents which of the following legislative acts?

Accepted Answer

The answer of  Figure 14-8
-Consider Figure 14-8 above."D" represents...

Question 13

Price fixing is illegal per se under the Sherman Act.What does "per se" mean?

Accepted Answer

"Per se" means "in and of itself", indicating that price fixing is inherently or intrinsically illegal under the Sherman Act, without any need for further analysis or evidence of harm to competition.

Question 14

conspiracy among firms to set prices for a product is referred to as

Accepted Answer

Price fixing refers to an illegal agreement among firms to set prices for a product, thereby reducing competition and increasing profits. This is a violation of antitrust laws and can lead to significant legal consequences for the firms involved.

Question 15

Controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price is called

Accepted Answer

This practice is known as vertical price fixing, as it involves an agreement between buyers and sellers at different levels of the supply chain (i.e. manufacturer and retailer). By setting a minimum retail price, the manufacturer can maintain the value of their brand and prevent retailers from engaging in price competition, ultimately improving profit margins for both parties involved in the agreement. However, this practice is illegal under antitrust laws in many countries as it limits price competition and can harm consumer welfare.

Question 16

or more competitors explicitly or implicitly setting prices is referred to as __________.

Accepted Answer

Horizontal price fixing occurs when competitors agree to set prices at a certain level, either explicitly or implicitly. This is illegal under antitrust laws, as it restricts competition and can lead to higher prices for consumers. Competitive collusion refers to any agreement between competitors to fix prices, whereas vertical price fixing refers to an agreement between a supplier and its customers to set prices. Lateral price fixing and price cooperation are not commonly used terms in the context of antitrust law.

Question 17

one of its least favorite actions,Amazon.com was caught fiddling with its price tags.Avid DVD buyers,buying in quantity for resale,found that the online retailer was offering different customers different prices for the same DVD,and complained vociferously.Amazon was caught red-handed.Company officials admitted that the company was trying to see how much it could charge for an item before buyers balked.No matter what the reasoning behind it,Amazon.com was using

Accepted Answer

Amazon.com was using price discrimination by offering different prices to different customers.

Question 18

of the following statements regarding the legal and regulatory aspects of pricing are true EXCEPT:

Accepted Answer

A manufacturer's MSRP has not been declared illegal per se by any recent U.S. Supreme Court decision. In fact, manufacturers are free to set their own suggested retail prices (MSRP), but they cannot enforce them as mandatory prices for retailers to charge. This is known as a vertical price restraint, which falls under the rule of reason analysis. The other statements are true.

Question 19

Price fixing is illegal per se under the

Accepted Answer

Price fixing is considered a violation of Section 1 of the Sherman Act, which prohibits agreements among competitors that restrain trade. Courts have consistently held that price fixing falls under the category of per se violations, meaning that the practice is illegal without the need to prove its anti-competitive effects.

Question 20

Price fixing refers to

Accepted Answer

Price fixing is a practice where firms conspire to set a fixed price for a product or service to eliminate competition and increase profits. It is illegal and can result in fines, penalties, and even imprisonment.

Quiz 14: Arriving at the Final Price

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

Vertical price fixing refers to

Resale price maintenance was declared illegal in 1975 under the

Vertical price fixing involves controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price.This practice is also called __________.

practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Price discrimination is illegal under the

Price discrimination refers to

Robinson-Patman Act covers promotional allowances as well as discounts.To legally offer promotional allowances to buyers,the seller must do so on a(n) __________ to all buyers businesses distributing the seller's products.

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

Figure 14-8 -Consider Figure 14-8 above."D" represents which of the following legislative acts?

Price fixing is illegal per se under the Sherman Act.What does "per se" mean?

conspiracy among firms to set prices for a product is referred to as

Controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price is called

or more competitors explicitly or implicitly setting prices is referred to as __________.

of the following statements regarding the legal and regulatory aspects of pricing are true EXCEPT:

Price fixing is illegal per se under the

Price fixing refers to