Sifco Inc.,a tire manufacturing company,stipulates that Rambox Corp.should buy its entire line of Roadgrip tires.Sifco has significant market power in a particular variety of Roadgrip tires for which no substitutes are available in the market.It uses this power to its advantage and does not agree to let Rambox buy less than the entire line of Roadgrip tires.The sales contract between Sifco and Rambox is an example of a ______.

Question

Quizplus · Accepted Answer

The sales contract between Sifco Inc. and Rambox Corp. is an example of a tying agreement. A common form of tying arrangement is known as full-line forcing. In full-line forcing, a seller compels a buyer or lessee to take a complete product line from the seller. As Sifco, the seller, is compelling Rambox, the buyer, to take a complete product line of Roadgrip tires, Sifco and Rambox have a tying agreement.

Sifco Inc,A Tire Manufacturing Company,stipulates That Rambox Corp