Texas Real Estate Brokerage Sales Apprentice Education (SAE) Practice Exam

What is the definition of a group boycott in real estate?

1. A collective pricing agreement

2. An agreement to limit business with a competitor

3. A shared marketing strategy

4. A refusal to cooperate with clients

The correct answer is: An agreement to limit business with a competitor

A group boycott in real estate refers specifically to an agreement among multiple parties to limit business dealings with a competitor. This practice is considered anti-competitive and is prohibited under various antitrust laws. When real estate professionals or companies collectively decide to avoid collaborating with or providing services to a competitor, they undermine fair competition and market integrity. Such actions can harm consumers by reducing their options and preventing competitive pricing. In contrast, while a collective pricing agreement might involve the setting of prices among parties, it is different from a boycott as it doesn’t inherently involve limiting business with a competitor. Similarly, a shared marketing strategy involves collaboration on advertising efforts without the intent to harm a competitor's market share. A refusal to cooperate with clients is not a boycott but rather a situation involving client relations that may not pertain directly to competitor interactions. Understanding the distinction between these concepts is crucial for recognizing the implications and legality surrounding group boycotts in the real estate industry.