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Exam 42: Antitrust

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Question 31

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What are the major functions of the Federal Trade Commission (FTC) and what power does the FTC have?

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The Federal Trade Commission has two maj...

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Question 32

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Under the 2004 amendments, corporate offenders who violate Sections 1 or 2 of the Sherman Act face fines of up to $100 million per violation.

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B) False

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Question 33

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The Federal Trade Commission may issue a cease and desist order having the effect of an injunction.

McDonald's Corporation grants to Bob a franchise in which he will be the only one who has the right to sell McDonald's products in his small hometown. Under the Sherman Act:

A restraint of trade may be classified as either horizontal or vertical.

In 1992 Horizontal Merger Guidelines were jointly issued by the Justice Department and the Federal Trade Commission.

All price discrimination is illegal under the Robinson-Patman Act.

The main goal of antitrust regulation is to prevent competitive behavior among firms.

The National Tax Accountants Professional Association (TAPA) has recommended that its members charge a minimum of $25 per hour for completing tax forms. This recommendation is probably:

The Clayton Act deals with which of the following situations?

Conglomerate mergers have been challenged only when:

The National Cooperative Research Act was passed to facilitate the use of joint ventures for joint research and development.

In the case of Eastman Kodak Co. v. Image Technical Services, Inc. the U.S. Supreme Court identified the exact conduct, beyond mere possession of monopoly power, which violates Section 2 of the Sherman Act.

Harry Jones at Jones Brothers Furniture Co. does not like the Brite Lamp Co. representative, so he decided that Jones Brothers would boycott Brite. Under the Sherman Act, this is:

Failure to comply with Section 1, but not Section 2, of the Sherman Act is a criminal violation.

The Clayton Act weakened the Sherman Act by eliminating illegal acts that had previously been prohibited.

In order for there to be a violation of Section 2 of the Sherman Act, in addition to monopoly power, the courts must find:

Like the Sherman Act, Section 3 of the Clayton Act applies only to practices involving commodities, not to those that involve services, intangibles, or land.

If a seller of a product conditions its sale upon the buyer's purchasing a second product from the seller, this is known as a:

Elko, Inc. and Fuldan, Inc. closely monitor each other's actions regarding the sale of consumer electronic products. Each corporation tries to match the other's product designs and specifications, prices, and advertising strategies. As a result, the two corporations have similar products, prices, and profits. Is this a violation of the antitrust laws?