Precision Parts Corporation and Aligned Gears, Inc

question 64

Essay

Precision Parts Corporation and Aligned Gears, Inc., are competitors selling certain machine parts that are otherwise generally unattainable in their geographic market. This market includes the states of Minnesota, North Dakota, and South Dakota. Precision Parts and Aligned Gears agree that Precision Parts will no longer sell in Minnesota and that Aligned Gears will no longer sell in North and South Dakota. Have Precision Parts and Aligned Gears violated any antitrust law? If so, which one? Explain. If they had divided their market by type of customer rather than geographic are, would the result be the same? Why or why not?

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Definitions:

Arctic Tundra

describes a cold, treeless biome found in the Arctic regions, characterized by permafrost, minimal precipitation, and short growing seasons.

Thick Fur

A dense layer of hair on animals that serves as insulation against cold temperatures and water.

Permafrost

A thick subsurface layer of soil that remains frozen throughout the year, occurring chiefly in polar regions.

Arctic Tundra

A cold, treeless region where the subsoil is permanently frozen, found in the Arctic circle.