If a telecommunications company drastically cuts the price for cellular phone service in order to eliminate local competitors,the company could be charged with
A) loss-leader pricing.
B) bait-and-switch pricing.
C) price fixing.
D) unfair slotting.
E) predatory pricing.

Question

Quizplus · Accepted Answer

Predatory pricing involves a company lowering its prices to drive out competitors and gain a monopoly position in the market. If a telecommunications company uses this strategy to eliminate local competitors, it could be charged with violating antitrust laws.

If a Telecommunications Company Drastically Cuts the Price for Cellular