In which of the following situations are consumers most likely to feel the effect of resale price maintenance?
A) Armstrong flooring gives the Home Center a trade discount.
B) A group of people who suffer from allergies launch a boycott against perfume manufacturers who place their scents in magazine ads.
C) The manufacturer of a product that prevents algae from growing in swimming pools bypasses the middlemen and sells directly to pool owners.
D) The Home Center buys Solarian brand flooring from Armstrong to sell to its customers.
E) Andi returns defective computer software to her local computer store.

Question

Quizplus · Accepted Answer

Resale price maintenance occurs when a manufacturer (like Armstrong in this case) sets the minimum or fixed price at which the retailer (the Home Center) must sell its product (Solarian brand flooring). This directly affects consumers by potentially keeping prices at a higher level than they might be in a competitive market, making it the situation where consumers are most likely to feel its effect.

In Which of the Following Situations Are Consumers Most Likely