Under the Robinson-Patman Act, a Producer May Not Be Able

question 56

Multiple Choice

Under the Robinson-Patman Act, a producer may not be able to charge one retailer a lower price than it charges another retailer just because the first retailer buys more merchandise. Volume discounts can be a violation of the Robinson-Patman because, according to the law:

• A) price discounts injure competition
• B) price discounts unfairly target urban areas
• C) price discounts give large volume retailers an advantage over small volume retailers
• D) price discounts unfairly target urban areas and price discounts give large volume retailers an advantage over small volume retailers
• E) price discounts injure competition and price discounts give large volume retailers an advantage over small volume retailers

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Definitions:

Mortgage

A loan specifically used to purchase real estate, where the property itself serves as collateral for the loan.

Capital Lease

A long-term lease agreement that allows a lessee to use an asset while essentially treating it as if it were their own by recognizing it on their balance sheet.

Compounded Quarterly

The method of figuring out interest that includes both the original principal amount and the interest that has compounded from earlier periods, calculated every three months.

Long Term Liability

A financial obligation of a company that is due for a period exceeding one year, including bonds payable, long-term loans, lease obligations, and pension obligations.