Question 1

Finely Engineered Parts Corporation (FEPC)and Great Gears & Gauges,Inc.(3G),are competitors selling certain machine parts that are otherwise generally unattainable in their geographic market.This market includes the states of California,Oregon,Washington,and Idaho.FEPC and 3G agree that FEPC will no longer sell in California and that 3G will no longer sell in Oregon,Washington,and Idaho.Have FEPC and 3G violated any antitrust law If so,which one Explain.If they had divided their market by type of customer rather than geographic are,would the result be the same Why or why not

Accepted Answer

The answer of Finely Engineered Parts Corporation (FEPC)and Great Gears...

Question 2

If an agreement is a per se violation of antitrust laws,there must be further inquiry into its reasonableness.

Accepted Answer

A) True 
 B)False

Question 3

Most group boycotts are legal.

Accepted Answer

A) True 
 B)False

Question 4

A unilateral refusal to deal with a particular person or firm never violates antitrust law.

Accepted Answer

A) True 
 B)False

Question 5

Market share and market concentration are the only factors for analyzing the anticompetitive effects of a merger.

Accepted Answer

A) True 
 B)False

Question 6

An agreement between firms operating at different levels in the manufacturing and distribution process does not affect competition.

Accepted Answer

A) True 
 B)False

Question 7

A price fixing agreement is analyzed under the rule of reason.

Accepted Answer

A) True 
 B)False

Question 8

A horizontal restraint of trade results from an agreement between firms at different levels in the manufacturing and distribution process.

Accepted Answer

A) True 
 B)False

Question 9

Minimum resale price maintenance agreements are subject to analysis under the rule of reason.

Accepted Answer

A) True 
 B)False

Question 10

Java Bean Company imports coffee beans and sells them under two-year contracts to Mellow Roast,Inc. ,and other coffeemakers.The contracts require that during the two-year term a coffeemaker not buy beans from Java Bean's competitors.The contracts do not limit the coffeemakers' purchase of tea or other beverage ingredients from other suppliers,however.In the second year of the contract,Mellow Roast protests that this arrangement violates antitrust law.Is Mellow Roast correct If not,why not If so,under which antitrust statute,or statutes,could these contracts be held illegal

Accepted Answer

The answer of Java Bean Company imports coffee beans and...

Question 11

Greeting Cards,Inc.(GCI),requires that the buyers of its line of greeting cards also agree to buy GCI t-shirts,balloons,and other products.This is

Accepted Answer

A) a group boycott. 
B) an exclusive-dealing contract. 
C) a price-fixing agreement. 
D) a tying arrangement.

Question 12

Electroplate Dishware Corporation conditions shipments of its products to Flo-Thru Stores,Inc. ,on Flo-Thru's agreement not to buy products from Glassy Ware Company,Electroplate's competitor.This is

Accepted Answer

A) an exclusive-dealing contract. 
B) a smart business deal. 
C) a trade association. 
D) a tying arrangement.

Question 13

Agreements among members of trade or professional organizations are exempt from antitrust laws.

Accepted Answer

A) True 
 B)False

Question 14

XtraOrdinaire Inc.competes with Yowza! Company in the same market.Their merger would be

Accepted Answer

A) a horizontal merger. 
B) an interlocking directorate. 
C) a tying arrangement. 
D) a vertical merger.

Question 15

Nano Software,Inc. ,conditions the sale of its OfficeBooks product on Payroll Personnel Company's agreeing to buy QuikReVu,Nano's photo-editing product.This deal is

Accepted Answer

A) legal,depending on its purpose and the effect on competition. 
B) legal,depending on production and transportation costs. 
C) legal under any circumstances. 
D) not legal under any circumstances.

Question 16

Seaside Cannery,Inc. ,is one of many producers of canned seafood.Seaside refuses to sell its products to Troll Harbor Restaurant Corporation.This refusal is most likely

Accepted Answer

A) an anticompetitive practice in violation of the Clayton Act. 
B) a per se violation of the Sherman Act. 
C) a violation of the Sherman Act under the rule of reason. 
D) not a violation of antitrust law.

Question 17

Delta Services,Inc. ,is the major wholesale distributor of software in the state of Florida.Its closest competitor is Efficient Systems Company,another Florida firm.The two firms agree that Delta will operate in south Florida and Efficient will operate in north Florida.This is

Accepted Answer

A) a group boycott. 
B) a market division. 
C) a price-fixing agreement. 
D) a tying arrangement.

Question 18

Smooth Sailing,Inc. ,conditions future shipments of its products to distributors on their agreement to charge the prices set by Smooth.This is

Accepted Answer

A) a barrier to entry. 
B) a horizontal restraint. 
C) a merger. 
D) a vertical restraint.

Question 19

Engine Components,Inc. ,a manufacturer of vehicle parts,refuses to sell to Fix-It,Inc. ,a national vehicle service firm.Engine Components convinces Greasy Motor Parts Company,a competitor,to do the same.This is

Accepted Answer

A) a group boycott. 
B) an exclusive-dealing contract. 
C) a price-fixing agreement. 
D) a tying arrangement.

Question 20

Zippy Moto-Bikes,Inc. ,wants to prevent discount dealers that carry its products without providing warranty services from cutting into the business of full-service dealers.Zippy's decision to restrict discount dealers to one type of customer and full-service dealers to another is

Accepted Answer

A) not subject to antitrust law. 
B) per se violations of the Sherman Act. 
C) subject to evaluation under the rule of reason. 
D) violations of the Clayton Act.

Exam 28: Antitrust and Restraints of Trade

If an agreement is a per se violation of antitrust laws,there must be further inquiry into its reasonableness.

Most group boycotts are legal.

A unilateral refusal to deal with a particular person or firm never violates antitrust law.

Market share and market concentration are the only factors for analyzing the anticompetitive effects of a merger.

An agreement between firms operating at different levels in the manufacturing and distribution process does not affect competition.

A price fixing agreement is analyzed under the rule of reason.

A horizontal restraint of trade results from an agreement between firms at different levels in the manufacturing and distribution process.

Minimum resale price maintenance agreements are subject to analysis under the rule of reason.

Greeting Cards,Inc.(GCI) ,requires that the buyers of its line of greeting cards also agree to buy GCI t-shirts,balloons,and other products.This is

Electroplate Dishware Corporation conditions shipments of its products to Flo-Thru Stores,Inc. ,on Flo-Thru's agreement not to buy products from Glassy Ware Company,Electroplate's competitor.This is

Agreements among members of trade or professional organizations are exempt from antitrust laws.

XtraOrdinaire Inc.competes with Yowza! Company in the same market.Their merger would be

Nano Software,Inc. ,conditions the sale of its OfficeBooks product on Payroll Personnel Company's agreeing to buy QuikReVu,Nano's photo-editing product.This deal is

Seaside Cannery,Inc. ,is one of many producers of canned seafood.Seaside refuses to sell its products to Troll Harbor Restaurant Corporation.This refusal is most likely

Delta Services,Inc. ,is the major wholesale distributor of software in the state of Florida.Its closest competitor is Efficient Systems Company,another Florida firm.The two firms agree that Delta will operate in south Florida and Efficient will operate in north Florida.This is

Smooth Sailing,Inc. ,conditions future shipments of its products to distributors on their agreement to charge the prices set by Smooth.This is

Engine Components,Inc. ,a manufacturer of vehicle parts,refuses to sell to Fix-It,Inc. ,a national vehicle service firm.Engine Components convinces Greasy Motor Parts Company,a competitor,to do the same.This is

Zippy Moto-Bikes,Inc. ,wants to prevent discount dealers that carry its products without providing warranty services from cutting into the business of full-service dealers.Zippy's decision to restrict discount dealers to one type of customer and full-service dealers to another is