Suppose a paint manufacturer refuses to let a hardware store carry its line of mildew-proof latex paint until the storeowner also agrees to carry the manufacturer's less popular brand of enamel paint. This is an example of a(n):
A) exclusive dealing agreement.
B) exclusive-territory policy.
C) monopoly.
D) tying contract.
E) horizontal conflict.

Question

Quizplus · Accepted Answer

This scenario is an example of a tying contract, where the sale of one product (the mildew-proof latex paint) is conditioned on the purchase of another product (the less popular brand of enamel paint).

Suppose a Paint Manufacturer Refuses to Let a Hardware Store