The courts have ruled that it is a reasonable restraint of trade (and therefore permissible) for the owner of a business to sell his business and sign a contract with the new owner saying he will not compete with her within a vicinity of, say, 100 miles, for a period of, say, 5 years. If this is a reasonable restraint of trade, can you give an example of what you would consider an unreasonable restraint of trade? Explain how you decide what is a reasonable restraint of trade and what isn' t. Site examples from your textbook and from your own experience.
The courts have ruled that it is a reasonable restraint of trade (and therefore permissible) for the owner of a business to sell his business and sign a contract with the new owner saying he will not compete with her within a vicinity of, say, 100 miles, for a period of, say, 5 years. If this is a reasonable restraint of trade, can you give an example of what you would consider an unreasonable restraint of trade? Explain how you decide what is a reasonable restraint of trade and what isn' t. Site examples from your textbook and from your own experience.
Chapter12: Government And Product Markets: Antitrust And Regulation
Section: Chapter Questions
Problem 10QP
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