Asked by Allyson Morgan on May 23, 2024
Verified
Two CEOs from different firms in the same market collude to fix the price in the market. This action violates the
A) Clayton Act of 1914.
B) Sherman Antitrust Act of 1890.
C) Crandall-Putnam ruling of 1983.
D) Jackson-Microsoft ruling of 2000.
Sherman Antitrust Act
A landmark U.S. legislation passed in 1890 that prohibits monopolistic business practices and promotes competition.
Price Fix
A practice where businesses agree to set the price of a product or service at a certain level, often illegally, to avoid competition.
CEOs Collude
This term refers to illegal or unethical agreements between CEOs of different firms to make decisions that restrict competition, manipulate prices, or control market entry.
- Identify the influence of antitrust regulations such as the Sherman Antitrust Act and the Clayton Act on market dynamics.
Verified Answer
YS
yadveer singhMay 28, 2024
Final Answer :
B
Explanation :
The Sherman Antitrust Act of 1890 is a landmark federal statute in the history of United States antitrust law (or "competition law") passed by Congress to prohibit monopolies or unreasonable combinations of companies to restrict or in any way control interstate commerce. This includes price fixing, which is the agreement between business competitors selling the same product or service regarding its pricing. The act aims to ensure competition remains fair and benefits the consumer, making the collusion to fix prices between CEOs from different firms a violation of this act.
Learning Objectives
- Identify the influence of antitrust regulations such as the Sherman Antitrust Act and the Clayton Act on market dynamics.