Asked by Sichen Zhang on Jun 26, 2024
Verified
The "rule of reason" indicated that
A) if less than four firms account for three-fourths of an industry's sales, the industry is in violation of the Sherman Act.
B) social regulation should not be enforced unreasonably so that costs exceed benefits.
C) the mere possession of monopoly power is a violation of the antitrust laws.
D) only contracts and combinations that unreasonably restrain trade violate the antitrust laws.
Sherman Act
A landmark federal statute in the field of United States antitrust law passed by Congress in 1890 to prohibit monopolistic business practices.
Monopoly Power
Monopoly power refers to the ability of a single seller or company to control the market for a particular good or service, allowing it to set prices above competitive levels.
Unreasonably Restrain
To limit or control someone or something to an excessive or unjustifiable extent, typically in a legal or regulatory context.
- Understand concepts like "rule of reason" and its application in antitrust cases.
Verified Answer
ZK
Zybrea KnightJul 03, 2024
Final Answer :
D
Explanation :
The "rule of reason" is a legal doctrine used in antitrust law, stating that not all monopolies, contracts, or conspiracies to restrain trade are illegal, but only those that unreasonably do so. This approach allows for a more nuanced analysis of the competitive effects of business practices.
Learning Objectives
- Understand concepts like "rule of reason" and its application in antitrust cases.