Final answer:
Homeruns Co.'s withdrawal of deals due to pricing issues involves Resale Price Maintenance (RPM). If the company mandated a fixed minimum price, it would likely violate per se antitrust laws. A quasi-RPM arrangement suggesting prices without mandating them might be legal.
Step-by-step explanation:
The act of Homeruns Co. withdrawing deals from retailers who refused to put a particular price tag on baseball bats relates to Resale Price Maintenance (RPM). The legality depends on the specifics of the agreement between the manufacturer and retailers. For instance, if Homeruns Co. had created a minimum resale price maintenance agreement that required retailers to sell the bats at a minimum price, it would be considered illegal because it restricts competition among dealers and thus could potentially violate antitrust laws like those established by the Sherman Act. This would be a breach of the per se rule against such price fixing. However, if the company simply suggested prices and decided to cease dealing with retailers that consistently sold below the suggested price, this could be considered legal under a quasi-RPM arrangement as it allows for some degree of retailer price autonomy while still potentially guiding pricing strategies. The subtlety in this distinction is significant in determining the legality of such practices.
It's also worth noting that the impact of price changes on products like baseball bats can have a wider economic effect, as changes to the price of one good can affect the quantity consumed of other goods, since consumers typically purchase multiple products out of the same budget. This can lead to both positive and negative effects on the broader market.