To prove predatory pricing, it must be proved that the destructive company explicitly tried to ruin a competitor and that the predatory price was below the predator's average variable cost.
Answer the following statement true (T) or false (F)
True
Predatory pricing is the practice of charging a very low price for a product with the intent of driving competitors out of business or out of a market. Once competitors have been driven out, the firm raises its prices. This practice is illegal under the Sherman Act and the Federal Trade Commission Act. To prove predatory pricing, the Justice Department must show that the predator—the destructive company—explicitly tried to ruin a competitor and that the predatory price was below the predator’s average variable cost. See 19-8d: Predatory Pricing.
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Indicate whether the statement is true or false
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