To prove predatory pricing, the predator must show that it explicitly tried to ruin a competitor and that the predatory price was below its average variable cost.

Question

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To prove predatory pricing, the plaintiff (not the predator) must show that the predator engaged in pricing that was below its average variable cost and that it had a reasonable chance of recouping its losses in the future. There is no requirement for the predator to explicitly try to ruin a competitor, although such behavior may be evidence of predatory intent.

To Prove Predatory Pricing, the Predator Must Show That It