In the 1970s,when a gasoline price ceiling was imposed that was below the equilibrium price of gasoline,some gas stations required that buyers of gas also purchase other products sold at the station.This policy is an example of which of the following?
A) price discrimination
B) tying arrangements
C) exclusive dealing
D) requirements contract
E) resale price maintenance

Question

Quizplus · Accepted Answer

Tying arrangements occur when a seller requires a buyer to purchase an additional product or service in order to obtain the desired product. In this case, the gas station required buyers of gasoline to also purchase other products sold at the station. This was likely done to increase sales of the other products and to offset the lower profit margins on gasoline due to the imposed price ceiling.

In the 1970s,when a Gasoline Price Ceiling Was Imposed That