The Court Decisions in the Borden Case Clearly Show That

question 200

Multiple Choice

The court decisions in the Borden case clearly show that:

• A) products of "like grade and quality" must be offered to all buyers at the same price-even if sold under different labels.
• B) manufacturers who supply retailers with dealer brands cannot force the retailer to charge consumers the manufacturer's suggested list price.
• C) price fixing is always illegal.
• D) a manufacturer can charge different prices for different brands of physically identical products as long as the price differentials do not exceed the recognized consumer appeal of the higher-priced brands.
• E) manufacturers cannot charge different prices for dealer brands and manufacturer brands.

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales over a short period, such as rent, insurance, and salaries.

Sunk Costs

Costs that have already been incurred and cannot be recovered.

Avoidable Costs

Expenses that can be eliminated if a particular decision is made or if a particular activity is discontinued.

Irrelevant Costs

Costs that should not influence decision-making because they will not change regardless of the outcome.