A Number of Antitrust Laws Have Been Enacted That Affect

Essay

A number of antitrust laws have been enacted that affect product pricing.
Required:
A.Define price discrimination and predatory pricing.
A.Price discrimination involves charging different prices to different customers for the same goods and services when the price differences are not based on variations in production,selling,and/or distribution cost.Predatory pricing,on the other hand,is the practice of reducing a price for a short time in order to enhance demand and then raising the price sharply,often with restricted supply.
B.Assume that a company has been charged with price discrimination.What role can cost information play in defending the firm's pricing practices?
B.Such information can be used to show differences in costs of providing a product or service to customers.For example,a customer that places a few large orders having low quality requirements can be served less expensively than another customer that places many small orders with tight delivery times and exacting quality specifications.