Question 16

USA Computer Corporation requires all distributors of its products to sell the products at specified minimum prices. This resale price maintenance agreement is

Question 16 options:

1)	a violation of the Clayton Act.

2)	not subject to antitrust law.

3)	a per se violation of the Sherman Act.

4)	subject to evaluation under the rule of reason.

Question 17

Jill's Dresses, Inc is a small retail dress shop. Jill's Dresses buys dresses from THE FASHION, Inc. THE FASHION requires that Jill's sell the dress for a minimum price of $100. Jill's sues THE FASHION under antitrust laws because it wants to sell the dresses for less than $100. What's the best analysis?

Question 17 options:

1)	THE FASHION will win a rule of reason case if it can show that it set the retail minimum price based on input from its customers (the retail dress stores) rather than creating the rule on its own.

2)	Jill's will win a rule of reason case of price fixing if Jill can show that THE FASHION engaged in retail minimum price fixing because other dress retailers asked THE FASHION to do so.

3)	THE FASHION will win a per se case of retail price maintenance agreements based on the Leegin precedent.

4)	Jill's will win a per se case of price fixing.

Question 18

Fastener Products, Inc., a maker of nuts and bolts, sells its products to retail establishments. It charges one price to small family-owned hardware stores and a lower price to national chains. Under the Clayton Act, these price differences are:

Question 18 options:

1)	not illegal if they are intended to prevent entry into a given market.

2)	not illegal if they are based on production or transportation costs.

3)

illegal.

4)	not illegal if they are intended to eliminate competition.

Question 19

Joe is shopping for something to put on the floor of his dairy barn. He tells Lorraine, a salesperson for Surge Dairy Products, that his cows have been slipping and falling on the wet floor, and he wants to buy some mats. Lorraine shows him a rubber flooring. Joe buys the floor covering and puts it in his dairy barn. Within days, the rubber floor mats are shredded by the cows' hooves. If he sues Surge Dairy Products, what kind of warranty would Joe most likely claim that Surge breached?

Question 19 options:

1)	a warranty of merchantability.

2)	a warranty of title.

3)	an express warranty.

4)	an implied warranty of fitness for a particular purpose.

Question 20

Smith operates Smith's Sports Memorabilia Shop which sells sports professional team logo clothing and signed pictures of players. Smith's son has outgrown his bicycle, so Smith brings the bike to his shop and sells it. Has Smith given an implied warranty of merchantability to the buyer?

Question 20 options:

1)	no, because Smith is not a merchant of bicycles and therefore the warranty does not arise.

2)	yes, but only if the buyer asks about it, and Smith makes an affirmation.

3)	yes, because the implied warranty of merchantability arises automatically.

Question 21

Selma owns Selma Chevrolet and does not like working on Saturdays but fears she would lose business if she closed on Saturdays. She takes this issue to a trade association meeting that includes all the state's car dealers. The trade association agrees to commit one million dollars of member fees to lobby the state legislature for a law prohibiting car dealers from selling cars on Saturday. This is...

Question 21 options:

1)	Permissible under antitrust laws because competitors are allowed to get together as trade associations and agree to lobby for law changes.

2)	Subject to the rule of reason to see if the anti-competitive effects of this restriction outweigh the beneficial aspects of the restriction.

3)	A per se violation of antitrust laws as a horizontal agreement to restrain trade.

Question 22

Midstate Sales Company engages in conduct that violates the antitrust laws and injures Regional Sales Corporation's business. Regional can sue Midstate for

Question 22 options:

1)	treble damages and attorneys' fees.

2)	Regional Sales cannot sue because only consumers and the government can sue under antitrust laws.

3)	actual damages only.

4)	for an injunction only.

Question 23

Assume, Whole Foods and Wild Oats, two organic grocery stores, are seeking to merge. The U.S. Department of Justice and the FTC are investigating whether or not to contest the merger based on antitrust laws. Select Whole Foods' best argument under antitrust law to allow the merger.

Question 23 options:

1)	The merger is a vertical merger and therefore less regulated under antitrust laws.

2)	The relevant product market is all grocery stores not just organic grocery stores and a combined Whole Foods and Wild Oats will represent only a very small market share of all grocery stores.

3)	If Whole Foods becomes a monopoly it will be able to reduce its prices due to larger stores and more efficiency.

4)	The merger would result in Whole Foods enjoying an 80% market share of the organic food market.

Question 24

The purpose of antitrust is to:

Question 24 options:

1)	To protect smaller corporations from the economies of scale achieved by larger corporations

2)	To protect consumers by ensuring competition that in turn ensures lower prices, more product information, and a better distribution of the wealth.

3)	To concentrate power in a few corporations

4)	To break up large inefficient corporations (AT&T as an example)