#1
Which of the following is an example of anticompetitive practice?
Price-fixing agreements between competitors
ExplanationCollusion to set prices, limiting competition.
#2
What is the main objective of market regulation?
To ensure fair competition and protect consumers
ExplanationMaintaining fair market conditions and consumer protection.
#3
What is the term for a market structure with only one seller?
Monopoly
ExplanationMarket domination by a single seller.
#4
What is the primary objective of antitrust laws?
To ensure that firms compete fairly in the marketplace
ExplanationPromoting fair competition and market integrity.
#5
Which of the following statements best describes predatory pricing?
Setting prices below cost to drive competitors out of the market
ExplanationDeliberately undercutting prices to eliminate competition.
#6
Which organization in the United States is primarily responsible for enforcing antitrust laws?
Federal Trade Commission (FTC)
ExplanationFTC oversees antitrust enforcement and competition policy.
#7
What is predatory pricing?
Setting prices below cost to drive competitors out of the market
ExplanationArtificially low prices to eliminate competition.
#8
What is market foreclosure?
Blocking competitors' access to distribution channels or resources
ExplanationRestricting rivals' access to markets.
#9
Which of the following is NOT a characteristic of monopolistic competition?
Barriers to entry
ExplanationMonopolistic competition allows easy market entry.
#10
What is the primary purpose of the Sherman Antitrust Act?
To prohibit certain business activities that restrict competition
ExplanationPreventing practices detrimental to market competition.
#11
What is the primary goal of the European Union's competition policy?
To ensure fair competition and protect consumers
ExplanationEU policy focuses on fair markets and consumer welfare.
#12
What is a 'tying arrangement' in the context of anticompetitive practices?
Selling one product on the condition that the buyer purchases another product
ExplanationForcing the purchase of one product to access another.
#13
What is the 'Rule of Reason' in antitrust law?
A doctrine that evaluates whether a particular restraint on trade promotes or suppresses competition
ExplanationAssessing if restrictions benefit or harm competition.
#14
What is the difference between horizontal and vertical restraints of trade?
Horizontal restraints involve agreements between competitors, while vertical restraints involve agreements between firms at different levels of the supply chain.
ExplanationHorizontal involves rivals, vertical involves different supply chain levels.
#15
What is the difference between price discrimination and price fixing?
Price discrimination involves setting different prices for different customers, while price fixing involves collusion to set prices at the same level.
ExplanationAdjusting prices based on customer segments versus collusion to fix prices.
#16
What is a consent decree in the context of antitrust law?
A legal document outlining the terms of a settlement between the government and a defendant in an antitrust case
ExplanationAgreement outlining terms between government and antitrust defendant.
#17
What is the difference between horizontal and vertical mergers?
Horizontal mergers involve firms in the same industry, while vertical mergers involve firms at different stages of the production process
ExplanationCombining companies in the same sector versus different production stages.