Coca-Cola,Inc.and PepsiCo,Inc.have only one distributor each in the Phoenix area.The Phoenix market is an intensely competitive soft drink market with prices being among the lowest in the nation.A local restaurateur has requested a dealership from PepsiCo and has been denied.He claims an antitrust violation.Which of the following statements is true?

Question

Quizplus · Accepted Answer

The denial of the dealership could be justified based on the level of interbrand competition in the Phoenix soft drink market. There is only one distributor each for Coca-Cola, Inc. and PepsiCo, Inc. in the region, and prices are already among the lowest in the nation. Therefore, adding another distributor may not necessarily increase competition or benefit consumers. The denial of the dealership does not necessarily constitute anticompetitive behavior or resale price maintenance.