Asked by anthony triguero on May 06, 2024

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Which of the following situations is most likely a case of Sherman Act Section 1 violation?

A) A manufacturer unilaterally assigns exclusive territories to its dealers.
B) A manufacturer unilaterally suggests a retail price to its dealers for its products.
C) A manufacturer causes its dealers to agree not to sell outside their dealership territories.
D) A manufacturer limits the dealerships it grants in a particular geographic area.

Sherman Act Section 1

A provision of U.S. antitrust law that prohibits contracts, combinations, or conspiracies that restrain interstate or foreign trade.

Violation

The act of disregarding or breaking a law, agreement, or rule, resulting in possible legal penalties or consequences.

Manufacturer

A person or company that makes goods for sale, especially on a large scale through the use of machines.

  • Identify the elements and legal consequences of tying agreements and vertical price-fixing.
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SC
Sahasawat ChaloemrotMay 10, 2024
Final Answer :
C
Explanation :
A manufacturer has always had the power to unilaterally assign exclusive territories to its dealers or to limit the dealerships it grants in a particular geographic area.However,manufacturers may run afoul of Section 1 of the Sherman Act by causing dealers to agree not to sell outside their dealership territories or by placing other restrictions on their dealers' right to resell their products.