Question 1

Refer to Fact Pattern 23-1.Cardio pays Emitate not to sell its product.This is

Accepted Answer

The answer of Refer to Fact Pattern 23-1.Cardio pays Emitate...

Question 2

A firm that is attempting to meet the competition's price may have a defense to liability for price discrimination.

Accepted Answer

A firm may be able to use the "meeting competition defense" under the Robinson-Patman Act to justify pricing decisions that are based on meeting a competitor's lower price. This defense requires that the firm's cost of production, transportation, and sale must not differ materially between the favored and disfavored buyers.

Question 3

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

Accepted Answer

This is the definition of a tying arrangement, in which the sale of one product is conditioned upon the purchase of another.

Question 4

Cooperative research by small-business firms is exempt from antitrust law.

Accepted Answer

The National Cooperative Research and Production Act of 1993 provides an antitrust exemption for small businesses engaged in cooperative research and development activities.

Question 5

Helio Company can process hydrogen into an inexpensive fuel for internal combustion engines.As an innovator in its market,Helio currently has the power to affect the price of its product.This is

Accepted Answer

Market power refers to the ability of a firm to affect the market price of its product due to its unique position in the market. Helio Company's ability to process hydrogen into an inexpensive fuel for internal combustion engines gives it a competitive advantage and allows it to affect the price of its product.

Question 6

To violate antitrust law,an attempt to monopolize a market must be intended to exclude competition and garner monopoly power.

Accepted Answer

According to antitrust laws, the attempt to monopolize a market must involve the intent to exclude competition and gain monopoly power in order to be considered a violation.

Question 7

A divestiture is an order to a company to cease,or divest itself of,its anticompetitive conduct.

Accepted Answer

The answer of A divestiture is an order to a...

Question 8

In determining the legality of a merger,a crucial consideration is market concentration.

Accepted Answer

Market concentration is an important factor in analyzing the competitive impact of a merger or acquisition. High market concentration can lead to reduced competition and potentially harm consumers. Therefore, antitrust authorities often examine market concentration to determine whether a merger would be harmful to competition and warrant further scrutiny.

Question 9

Enterprising Business Corporation may be engaging in conduct that violates the Sherman Act.To bring an action against the firm under this statute requires that its conduct have a significant impact on

Accepted Answer

The Sherman Act applies to conduct that affects interstate commerce, which is commerce that happens between different states or involves crossing state lines. Intrastate commerce, which occurs within a single state, is not sufficient for an action under the Sherman Act. While internet commerce may involve different states, it is not necessarily interstate commerce, and the impact on international commerce is not relevant for this statute. Therefore, the best choice is C.

Question 10

Under an exclusive-dealing contract,a seller promises a buyer a certain territory in which the buyer will have no direct competition.

Accepted Answer

The answer of Under an exclusive-dealing contract,a seller promises a...

Question 11

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

Accepted Answer

U.S. antitrust law applies to the conduct of U.S. firms that have an impact on foreign commerce, including protecting foreign consumers and competitors from antitrust violations by U.S. firms.

Question 12

Congress enacts a statute to outlaw a specific type of anticompetitive business agreement.Like other laws that regulate economic competition,this law is referred to as

Accepted Answer

Antitrust laws are statutes enacted by Congress to protect consumers from anticompetitive business practices that lead to higher prices, reduced choices, and stifled innovation. These laws promote fair competition by prohibiting monopolies, price fixing, and other anticompetitive agreements between businesses. The other options listed are either specific laws or not accurate descriptions of antitrust laws.

Question 13

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

Accepted Answer

U.S. firms may be subject to other nations' antitrust laws if they conduct business in those nations or engage in transactions with entities governed by those nations' laws.

Question 14

A joint refusal to deal with a particular person or firm is always a violation of antitrust law.

Accepted Answer

A joint refusal to deal may or may not violate antitrust laws depending on the circumstances. If it is used to eliminate competition, it could be considered a violation. However, if there are legitimate business reasons for the refusal, such as the person or firm has a track record of non-payment or unreliable delivery, then it may not be a violation.

Question 15

Persons in foreign nations cannot be subject to U.S.antitrust law.

Accepted Answer

Foreign persons and companies can be subject to U.S. antitrust law if their conduct has a direct, substantial, and reasonably foreseeable effect on U.S. commerce. This is known as the "effects doctrine" and has been established by U.S. courts.

Question 16

No person may be a director for two competing corporations at the same time.

Accepted Answer

The answer of No person may be a director for...

Question 17

Insurance companies are exempt antitrust laws whenever state regulation exists.

Accepted Answer

The McCarran-Ferguson Act of 1945 exempts insurance companies from federal antitrust laws, as long as the state has its own regulatory system in place to oversee the industry. Therefore, insurance companies are only exempt from antitrust laws when state regulation exists.

Question 18

Only private individuals can enforce the antitrust laws.

Accepted Answer

Both private individuals and the government can enforce the antitrust laws. Private individuals can file lawsuits to seek damages or injunctions, while the government can file lawsuits in federal court and seek civil penalties, damages, and injunctions as well.

Question 19

Charging different prices to different buyers for identical goods is price discrimination.

Accepted Answer

Price discrimination is the practice of charging different prices to different buyers for the same product or service.

Question 20

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

Accepted Answer

This is an example of an illegal restraint on trade as it decreases competition and violates antitrust laws. Companies cannot collude to control markets and prices as it harms consumers and limits fair competition.

Quiz 23: Antitrust Law and Promoting Competition