Suppose that you are the CEO of a coal mining company. The economy is in a severe
Question:
Suppose that you are the CEO of a coal mining company. The economy is in a severe recession. Your firm and all of its competitors are losing money and are in danger of bankruptcy. The price of coal has fallen so low that you cannot cover costs. You have laid off thousands of workers, and may well have to either lay off more or shut down. Your competitors are faced with the same choices.You are looking around for ways to mitigate this economic pain. A subordinate suggests that you and other coal mining companies agree with each other to sell your coal only through a sales agency, which would reduce the flow of coal to the market so as to raise the price of coal to the point where a firm can begin to be solvent. Upon reflection, you conclude that such a strategy would reduce losses and unemployment in the coal industry. In raising the price high enough so that sellers can be solvent, consumers are not being harmed in an unreasonable way.How does this proposal square with antitrust law?
International Business The Challenges of Globalization
ISBN: 978-0133866247
8th edition
Authors: John Wild, Kenneth Wild