Price-discrimination legislation is designed to limit the ability of ________.
A) retailers to charge less than a manufacturer's or wholesaler's suggested list price
B) manufacturers and wholesalers to grant large discounts or favorable terms to large retailers when the discount could not be justified by cost savings
C) manufacturers, wholesalers, and retailers from conspiring to fix retail prices
D) manufacturers from setting artificially low prices with the intent of destroying competition

Question

Quizplus · Accepted Answer

Price-discrimination legislation is aimed at preventing manufacturers and wholesalers from granting large discounts or favorable terms to select retailers when the discount is not justified by cost savings. This approach ensures that smaller retailers can compete on a level playing field with larger retailers, preventing monopolistic practices that stifle competition. The legislation does not regulate a manufacturer's or wholesaler's suggested list price, nor does it aim to prevent manufacturers from setting artificially low prices with the intent of destroying competition. It also does not target retailers' ability to charge less than the suggested list price.

Price-Discrimination Legislation Is Designed to Limit the Ability of ________