What Law Attempts To Stop Monopolies?

by | Last updated on January 24, 2024

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The Sherman Antitrust Act

—proposed in 1890 by Senator John Sherman from Ohio—was the first measure passed by the U.S. Congress to prohibit trusts, monopolies, and cartels. The Sherman Act also outlawed contracts, conspiracies, and other business practices that restrained trade and created monopolies within industries.

What was the Clayton Trust Act?

The newly created Federal Trade Commission enforced the Clayton Antitrust Act

and prevented unfair methods of competition

. Aside from banning the practices of price discrimination and anti-competitive mergers, the new law also declared strikes, boycotts, and labor unions legal under federal law.

Which of the following prohibits monopolies attempts to monopolize and any restraint of trade?


The Sherman Act

What did the Clayton Antitrust Act do?

The Clayton Antitrust Act, passed in 1914, continues

to regulate U.S. business practices today

. Intended to strengthen earlier antitrust legislation, the act prohibits anticompetitive mergers, predatory and discriminatory pricing, and other forms of unethical corporate behavior.

What are the four major antitrust laws?

The main statutes are

the Sherman Act of 1890, the Clayton Act of 1914 and the Federal Trade Commission Act of 1914

.

What is unlawful monopoly?

In United States antitrust law,

monopolization

is illegal monopoly behavior. The main categories of prohibited behavior include exclusive dealing, price discrimination, refusing to supply an essential facility, product tying and predatory pricing.

What are the four major provisions of the Clayton Act?

The principal provisions of the Clayton Act, which is far more detailed than the Sherman Act, the law it was meant to supplement, include (1) a prohibition on anticompetitive price discrimination; (2) a prohibition against certain tying and exclusive dealing practices;

(3) an expanded power of private parties to sue

Which of the following is not a violation of the Clayton Act?

Which of the following IS NOT a violation of the Clayton Act?

Price discrimination

. Incorrect. This is a violation of the Clayton Act.

What happens if you violate the Clayton Act?

Since the Clayton Act and the Federal Trade Commission Act are civil statutes, those convicted of violating these laws do not receive prison time. Instead, they

may be forced to pay fines and damages

.

How did the Clayton Antitrust Act help regulate the economy?

The Clayton Antitrust Act helped regulate the economy

by prohibiting business monopolies

.

What are the three major antitrust laws?

  • the Sherman Act;
  • the Clayton Act; and.
  • the Federal Trade Commission Act (FTCA).

What was the purpose of the Clayton Antitrust Act quizlet?

The Clayton Antitrust Act is an amendment passed by U.S. Congress in 1914 that

provides further clarification and substance to the

Sherman Antitrust Act of 1890 on topics such as price discrimination, price fixing and unfair business practices.

What is an example of an antitrust violation?

Another example of an antitrust violation is

collusion

. For example, three companies manufacture and sell widgets. They charge $1.00, $1.05, and $1.10 for their widgets. If these three companies plan and agree to all charge $1.15 for widgets, they’re likely in violation of antitrust laws.

Why are antitrust laws bad?

It shouldn’t be illegal to buy out another company if a fair price is being paid. By preventing mergers and acquisitions, antitrust

laws impede the most efficient arrangement of capital

. These laws protect inefficient managers at the cost of the greater economic good.

What constitutes an antitrust violation?


Violations of laws designed to protect trade and commerce from abusive practices

such as price-fixing, restraints, price discrimination, and monopolization.

What are some examples of a monopoly?

A monopoly is a firm who is the sole seller of its product, and where there are no close substitutes. An unregulated monopoly has market power and can influence prices. Examples:

Microsoft and Windows, DeBeers and diamonds, your local natural gas company

.

Ahmed Ali
Author
Ahmed Ali
Ahmed Ali is a financial analyst with over 15 years of experience in the finance industry. He has worked for major banks and investment firms, and has a wealth of knowledge on investing, real estate, and tax planning. Ahmed is also an advocate for financial literacy and education.