Question 1

The legality of which of the following actions would be determined using the rule- of- reason?

Accepted Answer

A) an agreement with a competitor firm to not sell to a particular customer 
B) an agreement with a competitor firm not to bid on a contract 
C) an exclusive dealings contract with a customer 
D) an agreement with a competitor firm to adjust output levels 
A) an agreement with a competitor firm to not sell to a particular customer 
B) an agreement with a competitor firm not to bid on a contract 
C) an exclusive dealings contract with a customer 
D) an agreement with a competitor firm to adjust output levels

Question 2

Bid rigging is analogous to price fixing.

Accepted Answer

A) True 
 B)False

Question 3

All of the following are examples of illegal per se activities except which one?

Accepted Answer

A) output restrictions 
B) price- fixing 
C) bid rigging 
D) resale price maintenance 
A) output restrictions 
B) price- fixing 
C) bid rigging 
D) resale price maintenance

Question 4

A manager of a firm located in the United States that sells some of its products abroad needs to comply only with United States antitrust law as the firm is only bound by the laws of the country in which it is located.

Accepted Answer

A) True 
 B)False

Question 5

If a firm has a market share that exceeds_______ percent, most courts will conclude that the firm is a monopoly and if the market share exceeds _______percent, the courts are likely to conclude that the firm is coming "dangerously close" to being a monopoly.

Accepted Answer

A) 75; 50 
B) 99; 50 
C) 90; 75 
D) 80; 60 
A) 75; 50 
B) 99; 50 
C) 90; 75 
D) 80; 60

Question 6

The basic goal of identifying a product market is for antitrust agencies to determine the products that consumers consider close substitutes.

Accepted Answer

A) True 
 B)False

Question 7

Actions that violate the Sherman Act can result in penalties that total substantially more than $100 million.

Accepted Answer

A) True 
 B)False

Question 8

Happy Cows contractually requires distributors who purchase Happy Cows' milk to also purchase Happy Cows' cream. The legality of the practice will be evaluated under Section_____ of the Clayton Act.

Accepted Answer

A) 3 
B) 7 
C) 8 
D) 2 
A) 3 
B) 7 
C) 8 
D) 2

Question 9

If three cell phone providers are in an agreement, this is an example of a_______ agreement.

Accepted Answer

A) vertical 
B) rightward 
C) leftward 
D) horizontal 
A) vertical 
B) rightward 
C) leftward 
D) horizontal

Question 10

If Crunchy Fries agrees to sell its frozen potato fries to a large grocery chain on the contractual condition that the grocery chain does not sell any of Crunchy Fries' competitors' frozen potato fries, this is an example of_____ .

Accepted Answer

A) an exclusive dealing contract 
B) a horizontal contract 
C) a requirements contract 
D) a tying arrangement 
A) an exclusive dealing contract 
B) a horizontal contract 
C) a requirements contract 
D) a tying arrangement

Question 11

The European Union policy almost automatically presumes that a single firm with a market share that exceeds_____ percent is dominant.

Accepted Answer

A) 75 
B) 50 
C) 30 
D) 80 
A) 75 
B) 50 
C) 30 
D) 80

Question 12

The Antitrust Division of the Department of Justice enforces antitrust laws through both civil and criminal suits.

Accepted Answer

A) True 
 B)False

Question 13

If an automobile manufacturer has an agreement with its tire supplier, this is an example of a _______agreement.

Accepted Answer

A) rightward 
B) horizontal 
C) leftward 
D) vertical 
A) rightward 
B) horizontal 
C) leftward 
D) vertical

Question 14

Three firms agree to operate as a monopoly and charge the monopoly price of $100 for their product and (jointly)produce the monopoly quantity of 20,000 units. If the competitive price for the product is $35, under the Clayton Act these three firms face treble damages of_______.

Accepted Answer

A) $1,000,000 
B) $3,000,000 
C) $3,900,000 
D) $1,300,000 
A) $1,000,000 
B) $3,000,000 
C) $3,900,000 
D) $1,300,000

Question 15

_____mergers can lead to increased market power and, as a result, _____the total surplus in the market.

Accepted Answer

A) Horizontal; increase 
B) Vertical; increase 
C) Horizontal; decrease 
D) Vertical; decrease 
A) Horizontal; increase 
B) Vertical; increase 
C) Horizontal; decrease 
D) Vertical; decrease

Question 16

The European Union antitrust law focuses on which of the following?

Accepted Answer

A) consumer welfare 
B) furthering the social interest 
C) ethics 
D) the means to monopolize a market 
A) consumer welfare 
B) furthering the social interest 
C) ethics 
D) the means to monopolize a market

Question 17

If a pre- merger Herfindahl- Hirschman Index (HHI)is between _____, the market is considered moderately competitive and if a merger in this market raises the HHI by more than ______ , antitrust agencies worry about the potential loss of competition.

Accepted Answer

A) 1,500 and 2,500; 50 
B) 2,500 and 5,500; 100 
C) 1,500 and 2,500; 100 
D) 2,500 and 5,500; 25 
A) 1,500 and 2,500; 50 
B) 2,500 and 5,500; 100 
C) 1,500 and 2,500; 100 
D) 2,500 and 5,500; 25

Question 18

Exclusive dealing contracts and requirements contracts have both procompetitive and anticompetitive motivations.

Accepted Answer

A) True 
 B)False

Question 19

If a software company enters into an agreement with its distributors to only resell its software in 5 specific states, under United States antitrust laws, this agreement is illegal per se.

Accepted Answer

A) True 
 B)False

Question 20

A company promotes a 'buy one, get one free' offer such that customers who purchase one unit of the product can get a second unit for free. The legality of the practice will be evaluated under Section _______of the Clayton Act.

Accepted Answer

A) 3 
B) 8 
C) 7 
D) 2 
A) 3 
B) 8 
C) 7 
D) 2

The legality of which of the following actions would be determined using the rule- of- reason?

Bid rigging is analogous to price fixing.

All of the following are examples of illegal per se activities except which one?

A manager of a firm located in the United States that sells some of its products abroad needs to comply only with United States antitrust law as the firm is only bound by the laws of the country in which it is located.

If a firm has a market share that exceeds_ percent, most courts will conclude that the firm is a monopoly and if the market share exceeds _percent, the courts are likely to conclude that the firm is coming "dangerously close" to being a monopoly.

The basic goal of identifying a product market is for antitrust agencies to determine the products that consumers consider close substitutes.

Actions that violate the Sherman Act can result in penalties that total substantially more than $100 million.

Happy Cows contractually requires distributors who purchase Happy Cows' milk to also purchase Happy Cows' cream. The legality of the practice will be evaluated under Section_____ of the Clayton Act.

If three cell phone providers are in an agreement, this is an example of a_______ agreement.

If Crunchy Fries agrees to sell its frozen potato fries to a large grocery chain on the contractual condition that the grocery chain does not sell any of Crunchy Fries' competitors' frozen potato fries, this is an example of_____ .

The European Union policy almost automatically presumes that a single firm with a market share that exceeds_____ percent is dominant.

The Antitrust Division of the Department of Justice enforces antitrust laws through both civil and criminal suits.

If an automobile manufacturer has an agreement with its tire supplier, this is an example of a _______agreement.

Three firms agree to operate as a monopoly and charge the monopoly price of $100 for their product and (jointly)produce the monopoly quantity of 20,000 units. If the competitive price for the product is $35, under the Clayton Act these three firms face treble damages of_______.

_mergers can lead to increased market power and, as a result, _the total surplus in the market.

The European Union antitrust law focuses on which of the following?

If a pre- merger Herfindahl- Hirschman Index (HHI)is between _, the market is considered moderately competitive and if a merger in this market raises the HHI by more than __ , antitrust agencies worry about the potential loss of competition.

Exclusive dealing contracts and requirements contracts have both procompetitive and anticompetitive motivations.

If a software company enters into an agreement with its distributors to only resell its software in 5 specific states, under United States antitrust laws, this agreement is illegal per se.

A company promotes a 'buy one, get one free' offer such that customers who purchase one unit of the product can get a second unit for free. The legality of the practice will be evaluated under Section _______of the Clayton Act.

Managerial Economics and Decision Making

Demand and Supply

Measuring and Using Demand

Production and Costs

Perfect Competition

Monopoly and Monopolistic Competition

Cartels and Oligopoly

Game Theory and Oligopoly

Advanced Pricing Decisions

Decisions About Vertical Integration and Distribution

Decisions About Production, Products, and Location

Marketing Decisions: Advertising and Promotion

Business Decisions Under Uncertainty

Managerial Decisions About Information

Using Present Value to Make Multi-Period Managerial Decisions

Filters

Exam 9: A Managers Guide to Antitrust Policy

The legality of which of the following actions would be determined using the rule- of- reason?

Bid rigging is analogous to price fixing.

All of the following are examples of illegal per se activities except which one?

A manager of a firm located in the United States that sells some of its products abroad needs to comply only with United States antitrust law as the firm is only bound by the laws of the country in which it is located.

If a firm has a market share that exceeds_______ percent, most courts will conclude that the firm is a monopoly and if the market share exceeds _______percent, the courts are likely to conclude that the firm is coming "dangerously close" to being a monopoly.

The basic goal of identifying a product market is for antitrust agencies to determine the products that consumers consider close substitutes.

Actions that violate the Sherman Act can result in penalties that total substantially more than $100 million.

Happy Cows contractually requires distributors who purchase Happy Cows' milk to also purchase Happy Cows' cream. The legality of the practice will be evaluated under Section_____ of the Clayton Act.

If three cell phone providers are in an agreement, this is an example of a_______ agreement.

If Crunchy Fries agrees to sell its frozen potato fries to a large grocery chain on the contractual condition that the grocery chain does not sell any of Crunchy Fries' competitors' frozen potato fries, this is an example of_____ .

The European Union policy almost automatically presumes that a single firm with a market share that exceeds_____ percent is dominant.

The Antitrust Division of the Department of Justice enforces antitrust laws through both civil and criminal suits.

If an automobile manufacturer has an agreement with its tire supplier, this is an example of a _______agreement.

Three firms agree to operate as a monopoly and charge the monopoly price of $100 for their product and (jointly)produce the monopoly quantity of 20,000 units. If the competitive price for the product is $35, under the Clayton Act these three firms face treble damages of_______.

_____mergers can lead to increased market power and, as a result, _____the total surplus in the market.

The European Union antitrust law focuses on which of the following?

If a pre- merger Herfindahl- Hirschman Index (HHI)is between _____, the market is considered moderately competitive and if a merger in this market raises the HHI by more than ______ , antitrust agencies worry about the potential loss of competition.

Exclusive dealing contracts and requirements contracts have both procompetitive and anticompetitive motivations.

If a software company enters into an agreement with its distributors to only resell its software in 5 specific states, under United States antitrust laws, this agreement is illegal per se.

A company promotes a 'buy one, get one free' offer such that customers who purchase one unit of the product can get a second unit for free. The legality of the practice will be evaluated under Section _______of the Clayton Act.

Managerial Economics and Decision Making

Demand and Supply

Measuring and Using Demand

Production and Costs

Perfect Competition

Monopoly and Monopolistic Competition

Cartels and Oligopoly

Game Theory and Oligopoly

Advanced Pricing Decisions

Decisions About Vertical Integration and Distribution

Decisions About Production, Products, and Location

Marketing Decisions: Advertising and Promotion

Business Decisions Under Uncertainty

Managerial Decisions About Information

Using Present Value to Make Multi-Period Managerial Decisions

Filters

If a firm has a market share that exceeds_ percent, most courts will conclude that the firm is a monopoly and if the market share exceeds _percent, the courts are likely to conclude that the firm is coming "dangerously close" to being a monopoly.

_mergers can lead to increased market power and, as a result, _the total surplus in the market.

If a pre- merger Herfindahl- Hirschman Index (HHI)is between _, the market is considered moderately competitive and if a merger in this market raises the HHI by more than __ , antitrust agencies worry about the potential loss of competition.