Certification in Supplier Diversity Practice Exam

What is one exception that allows a seller to offer a lower price under the Robinson-Patman Act?

1. To match a competitor’s price

2. To move distressed merchandise

3. To sell to government entities

4. To comply with international codes

The correct answer is: To move distressed merchandise

The Robinson-Patman Act is a federal law aimed at preventing anti-competitive practices by producers, manufacturers, and sellers. One significant provision within this act allows sellers to engage in price discrimination under certain circumstances. Among these exceptions is the ability to offer a lower price to move distressed merchandise. The rationale behind this exception is that distressed merchandise typically refers to goods that are damaged, obsolete, or otherwise undesirable. By permitting sellers to reduce prices on such items, the law allows businesses to clear out inventory that may otherwise stagnate, minimizing their financial losses. This encourages competition by enabling sellers to sell goods that might not find buyers at standard prices, thus maintaining healthy market activity and preventing waste. The other options, while they present different scenarios, do not align with the specific exceptions outlined in the Robinson-Patman Act. For example, matching a competitor's price and selling to government entities do not inherently fall under the exemptions provided by this particular act, as they can lead to broader implications regarding competitive pricing. Compliance with international codes also does not relate to the provisions of the act concerning pricing and is thus not relevant to this context.