Horizontal and Vertical Agreements that Violate the Sherman Act


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question 1 of 3

Flip's Burgers only sells Yum-A-Roo brand sodas. This is considered:

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1. Highway Motel and Motel Vagabond are the only two hotels on Route 1A. A snow storm is predicted for Saturday night. Knowing that the highway may be impassable, the two innkeepers decide to raise their prices from $39.00 a night to $149.00 a night. Why is this an example of price fixing?

2. Sampson Industries manufacture a car powered by cooking oil. You only need corn oil to run the car. However, when a customer purchases a car, they are forced to agree to purchase oil from Sampson and no other seller. This an example of a _____.

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About This Quiz & Worksheet

These assessment tools help you test your knowledge of how companies may violate the Sherman Act. To pass the quiz, you will need to be familiar with topics such as the definition of a vertical agreement and a horizontal agreement.

Quiz & Worksheet Goals

Assess your understanding of these topics using this quiz and worksheet combination:

  • Definition of vertical agreement and horizontal agreement
  • Coordination among businesses to raise prices
  • Understand when business choices do not violate the Sherman Act

Skills Practiced

Utilize the quiz and worksheet to practice the following skills:

  • Information recall - access the knowledge you've gained regarding key terms
  • Knowledge application - use your knowledge to answer questions about competitor coordination on price adjustments
  • Distinguishing differences - compare and contrast topics from the lesson, like vertical agreement and horizontal agreement

Additional Learning

Learn more about this subject, check out the accompanying lesson called Horizontal and Vertical Agreements that Violate the Sherman Act. That lesson covers these important objectives:

  • Define market allocations, monopolies, and Rule of Reason
  • Recognize how business choices do not constitute a violation of the Sherman Act
  • Understand the negative impact of price fixing on consumers
  • Explore how Section 1 of the Sherman Act applies to businesses and their interaction with competitors