Mark Johnson, the manager of a discount consumer electronics store, was approached by the manufacturer's representative on behalf of a marketer of a popular and profitable line of storage racks. The manufacturer's representative implied that if Johnson doesn't raise the retail prices for the storage racks to those paid by the marketer's non-discount customers, Johnson's supply of racks may be severely curtailed. The manufacturer's representative is guilty of attempting
A)horizontal price-fixing.
B)vertical price-fixing.
C)price discrimination.
D)predatory pricing.
E)bait and switch pricing.

Question

Quizplus · Accepted Answer

The manufacturer's representative is engaging in vertical price-fixing by pressuring the manager to raise prices to those paid by non-discount customers. This is illegal under the Sherman Antitrust Act.

Mark Johnson, the Manager of a Discount Consumer Electronics Store