A strategy of exclusive dealing is most likely considered legal if ________.
A) the industry is newly developed
B) both parties have large territories
C) competition is not substantially lessened
D) the dealer agrees to promote the competitor's products
E) the dealer receives a steady source of supply and support

Question

Quizplus · Accepted Answer

A strategy of exclusive dealing, where a supplier sells a product to a single dealer, is legal if competition is not substantially lessened. The court examines the potential impact of exclusionary contracts on competition in the market. If exclusive dealing ensures a steady source of supply and support to dealers and benefits consumers through increased efficiency or the promotion of inter-brand competition, it is considered legal. Therefore, choice C is the best answer.

A Strategy of Exclusive Dealing Is Most Likely Considered Legal