As the manager of a hotel, you recently noticed that one of your suppliers has started advertising their prices and has changed the specifications of its product to match those of its rivals. The actions of your supplier suggest that any of the following might be occurring except which one?

Question

Quizplus · Accepted Answer

The supplier would not be paying treble damages unless they were found guilty of violating antitrust laws. This answer choice implies that the supplier has already committed a violation and is being punished, which is not suggested in the given information. The other answer choices (A, C, and D) are all possible explanations for the supplier's actions. A suggests that the supplier is part of a cartel, which is an illegal agreement between competitors to fix prices or output. C suggests that the supplier is attempting to increase its profits by offering more competitive prices and specifications. D suggests that the supplier is attempting to engage in tacit collusion, which is when competitors implicitly coordinate their actions without making any explicit agreement.

As the Manager of a Hotel, You Recently Noticed That