Mark Johnson, the manager of a discount consumer electronics store, has been approached by the manufacturer of a popular and profitable line of compact disk storage racks regarding the retail price charged for the racks at Johnson's store. The manufacturer's representative has implied that if Johnson doesn't raise the retail prices for the storage racks to those charged by the manufacturer's non-discount customers, Johnson's supply of racks may be severely curtailed. The manufacturer is guilty of attempting:
A)horizontal price fixing.
B)predatory pricing.
C)price discrimination.
D)resale price maintenance.

Question

Quizplus · Accepted Answer

The manufacturer is guilty of attempting resale price maintenance, which occurs when a manufacturer attempts to dictate the price at which resellers can sell its products. This is illegal under the Sherman Antitrust Act.

Mark Johnson, the Manager of a Discount Consumer Electronics Store