Economics Homework Help

Q1:

1. What are the two main categories of horizontal practices that would raise antitrust concerns? (1 point)
2. Briefly describe a real-world example for each of those two main categories. Avoid using the cases presented in the case studies in the Antitrust Revolution textbook. (2 points)

Q2:

1. What are “facilitating practices” in the context of anticompetitive horizontal practices? (1 point)
2. Give two examples of such “facilitating practices”. (2 points)

Q3:

1. What is “classic predation”? (1 point)
2. Chicago School adherents have argued that predation is rarely rational. What are the two main reasons that they provide to support their claim? (2 points)

Q4:

Claim: “Following the entrance of a new coffee chain in a city, the incumbent coffee chain lowers its price by more than half. Thus, the incumbent is engaging in predatory pricing.” Do you agree with this claim? Explain. How would you determine whether predatory pricing indeed took place? Describe the analytical steps that are required.