A fast-food franchisee is required by its franchisor to buy unmarked plastic eating utensils from the franchisor if the franchisee wants to use the cups,napkins,and other paper products with the franchise logo.The franchisee can buy the identical utensils from a local supplier for half the price.This requirement would be an example of:

Question

Quizplus · Accepted Answer

This requirement is an example of a tying arrangement. The franchisor is tying the purchase of unmarked plastic utensils to the use of branded paper products. This is a violation of antitrust laws because it allows the franchisor to maintain control over the market for branded paper products and limit competition.

A Fast-Food Franchisee Is Required by Its Franchisor to Buy