Explain horizontal price-fixing and vertical minimum and maximum price-fixing. Discuss their status under antitrust laws
Horizontal price-fixing is the agreement between competitors on the prices at which they will buy or sell products or services. Horizontal price-fixing is a per se violation of Section 1 of the Sherman Act. Vertical price-fixing occurs when a manufacturer sets the minimum or maximum prices its distributors can charge. Resale price maintenance (RPM) is vertical minimum price-fixing, and in 1911 the Supreme Court held RPM to be a per se violation of the Sherman Act. However, in 2007, the Court reversed itself and held that RPM is a rule of reason violation. Vertical maximum price-fixing is also a rule of reason violation of the Sherman Act. The defendant is liable only if the price-fixing harms competition.
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Which of the following is not an action that a leader would engage in to demonstrate EML?
a. serving as a role model for ethical values b. demonstrating courage c. sending people who break the law to jail d. avoiding abusiveness
The tort of negligent supervision comes about when an employee is left in a position that may be harmful to others after notice is given to an employer
Indicate whether the statement is true or false
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Answer the following statement true (T) or false (F)
Vysion produces TVs it sells nationwide. Vysion contracted with Karol's Appliances to make it the exclusive distributor of Vysion TVs in the San Diego area. Karol's received a promise that Vysion would not sell its TVs to any other retailer within 20 miles of Karol's. In its San Diego stores, Karol's has a unique pricing policy. A higher price is charged to customers wearing suits than to
customers not wearing suits. Karol's salespeople give non-suit-wearing customers 10% discounts off of the list price, and refuse any discounts to suit-wearing customers. Don's, a rival of Karol's, asked Vysion to allow it to sell its products in San Diego. Vysion refused, pointing to its contract with Karol's. Vysion's distribution policy differs in New York from what it is in California. In New York, Vysion allows every distributor who asks to sell Vysion TVs. However, Vysion requires that New York retailers sign contracts stating that they agree not to sell Vysion products below prices in a monthly "price list" sent by Vysion. In contracts with its distributors nationwide, Vysion insists that sales of its TVs be tied to sales of its VCRs. No consumer is allowed to purchase a Vysion TV without also buying a Vysion VCR. The contract signed by Vysion with Karol's Appliances that guarantees Karol will be the sole distributor of Vysion products in the San Diego area is: a. a customer restriction b. a vertical price restraint c. a retail price restraint d. a territorial restraint e. a horizontal price restraint