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

Which type of violations can lead to substantial fines under antitrust laws?

1. Price Fixing and Deceptive Advertising

2. Group Boycotts and Price Fixing

3. Brokerage Shopping and Regulation Violations

4. False Reporting and Group Boycotting

The correct answer is: Group Boycotts and Price Fixing

Price fixing and group boycotts are both serious violations under antitrust laws, and they can lead to substantial fines. Price fixing occurs when two or more parties agree to set prices at a certain level, rather than allowing market forces to dictate pricing. This behavior eliminates competition and can lead to inflated prices for consumers. Antitrust laws aim to promote healthy competition, and price fixing is viewed as a direct threat to that principle. Group boycotts involve an agreement between two or more entities to collectively refuse to do business with a particular company or individual. This practice can stifle competition and restrict market access for those targeted businesses. Both price fixing and group boycotts are seen as anti-competitive practices, which is why they are penalized with substantial fines under antitrust statutes. The intent behind these laws is to safeguard free-market competition and protect consumers from the negative effects of collusion.