Pat's Pen Co

question 14

Multiple Choice

Pat's Pen Co.manufacturers and sells an inexpensive ball-point pen.Salley's Stationery purchases the pens for $.25 each in quantities of 1,000.Salley's discovered that a national chain,a competitor of Salley's,buys the pen at $.20 for 1,000.If Salley's Stationery sues Pat's Pen Co.for price discrimination:

• A) Pat's Pen Co. will win if it can prove that it has been selling to the national chain continuously at the cheaper rate.
• B) Pat's Pen Co. will win if it can prove that it did not intend to economically harm Salley's Stationery.
• C) Salley's Stationery will win unless Pat's Pen Co. can justify the price differential.
• D) Salley's Stationery will win since price discrimination is a per se violation with no real defenses.

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Definitions:

Security Selection

The process of choosing stocks or other securities for investment, aiming to achieve better performance than a selected benchmark.

Asset Classes

Categories of assets, such as stocks, bonds, real estate, and commodities, that exhibit similar characteristics and behave similarly in the marketplace.

Agency Problems

Conflicts of interest that arise when there's a disconnect in objectives between decision-makers (agents) and the owners (principals) of an entity.

Corporate Spies

Individuals or entities that engage in espionage or intelligence gathering on competitors for commercial purposes, not for national security.