Answer (C) is correct . Predatory pricing is intentionally pricing below cost to eliminate competition and reduce supply. Federal statutes and many state laws prohibit the practice. The U.S. Supreme Court has held that pricing is predatory when two conditions are met: ?(1)?The seller’s price is below “an appropriate measure of its costs,” and (2) it has a reasonable prospect of recovering the resulting loss through higher prices or greater market share.
Answer (A) is incorrect because Collusive pricing involves a conspiracy to set higher prices.
Answer (B) is incorrect because Dumping is defined under U.S.?law as sale by a non-U.S. company in the U.S.?market of a product below its market value in the country where it was produced. Such sale is illegal if it threatens material injury to a U.S.?industry.
Answer (D) is incorrect because Price discrimination entails charging different prices to different customers for essentially the same product if the effect is to lessen competition substantially; to tend to create a monopoly; or to injure, destroy, or prevent competition.
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