Asked by Yocabed Efrem on May 10, 2024
Verified
In the U.S. Steel case, the court ruled that
A) even though a firm's behavior might be legal, the mere possession of monopoly power was in violation of the Sherman Act.
B) only monopolies that unreasonably restrain trade are subject to antitrust action under the Sherman Act.
C) when made by dominant firms, tying contracts are illegal, per se.
D) the company violated the Clayton Act and therefore should be dissolved into several competing firms.
Sherman Act
This law is a landmark legal statute in the U.S. that prohibits monopolies and any agreements that restrict free trade, aiming to foster competition.
Monopoly Power
The ability of a single seller to control market prices and exclude competitors within a particular market.
Tying Contracts
Agreements where the sale of one product (the tying product) is conditional on the purchase of a second, distinct product (the tied product).
- Discern notable antitrust actions and their outcomes in sculpting the business panorama in the U.S.
- Familiarize oneself with concepts including the "rule of reason" and its implementation in antitrust proceedings.
Verified Answer
SC
Skylar CrossMay 13, 2024
Final Answer :
B
Explanation :
The U.S. Steel case established that only monopolies that unreasonably restrain trade are subject to antitrust action under the Sherman Act, emphasizing that mere possession of monopoly power is not in itself illegal unless it is acquired or maintained through improper conduct.
Learning Objectives
- Discern notable antitrust actions and their outcomes in sculpting the business panorama in the U.S.
- Familiarize oneself with concepts including the "rule of reason" and its implementation in antitrust proceedings.