Under a rule of reason approach, an act is illegal:
A) only if it is shown to result in an anticompetitive outcome.
B) if two parties merge.
C) if a firm engages in price discrimination.
D) if two firms engage in price fixing.

Question

Quizplus · Accepted Answer

Under a rule of reason approach, an act is illegal if it is shown to result in an anticompetitive outcome. This means that the act must have a negative impact on competition in the market, such as reducing consumer welfare or limiting the ability of other firms to compete. Price discrimination and price fixing can be examples of anticompetitive behavior, but they are not automatically illegal without considering the overall effect on competition. Mergers may also be examined under a rule of reason approach, but this choice is too broad as not all mergers are necessarily illegal.

Under a Rule of Reason Approach, an Act Is Illegal