Antitrust Law

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Antitrust Law

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Auto Sales. When should Price Discrimination. be allowed? Doctors charge different ... Prevent aggressive price cutting (cutthroat acts) List the Intent of These Acts: ... – PowerPoint PPT presentation

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Title: Antitrust Law


1
Antitrust Law
  • Chapter 9 Section 1

2
Question
  • What is your definition of
  • trust?

3
Objectives
  • What do the antitrust acts deem illegal?
  • What are the criticisms of the antitrust acts?

4
  • TRUST
  • A combination of business firms or corporations
    formed by an agreement (act as a monopoly)

5
  • PRICE DISCRIMINATION
  • A seller charges different buyers different
    prices for the same product
  • Example
  • Auto Sales

6
When should Price Discrimination be allowed?
? Doctors charge different prices for the same
service.
? Why is this acceptable?
7
The Clayton Act
  • Prohibits
  • Price Discrimination when it substantially
    reduces competition
  • Tying Contracts
  • Sale of one product depends on the purchase of
    some other product

8
  • Prohibits
  • Acquisition of competing companies stock if the
    acquisition reduces competition
  • Interlocking Directorates
  • Directors of one company sit on the board of
    directors of another company in the same industry

9
Why would the U.S. Government enact Anti-Trust
legislation?
  • A stated objective of government is to encourage
    competition
  • so that monopolies do not have substantial
    control
  • over the prices that they charge.

10
List the Intent of These Acts
  • Attempting to become a monopoly or restraining
    trade is illegal
  • Certain business practices could not result in a
    monopolistic effect
  • Prevent aggressive price cutting (cutthroat acts)
  • Sherman Act
  • Clayton Act
  • Federal Trade Commission Act

11
List the Intent of These Acts
  • Robinson-Patman Act
  • Wheeler-Lea Act
  • Suppliers must give identical discounts to
    smaller retailers
  • (help small business)
  • Prevent deceptive practices
  • (false advertising)

12
Assessment
  • What do the antitrust acts deem illegal?
  • What are the criticisms of the antitrust acts?
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