The Economic Way of Thinking 13th Edition by David Prychitko, Peter Boettke, Paul Heyne

Exercise 14

Three elements that must be present for a firm to be engaged in predatory pricing are pricing (a) below cost, (b) in order to eliminate rivals, and (c) with the intention of raising prices afterward to recoup. What factors would make the last step of the process difficult to complete? Under what kinds of circumstances would it be relatively easy? Can you cite any actual examples?