Final answer:
C) they are not short term.
B2B quantity discounts are lawful if they are available to all customers, are not short-term, allow new customers to buy up to minimum quantities, and cumulative discounts do not extend beyond a calendar year. Manufacturers can suggest prices but cannot impose minimum resale prices, and exclusive dealing agreements are legal if they promote competition but not if they limit it.
Step-by-step explanation:
B2B quantity discounts are legal under certain conditions to ensure that they do not have an anticompetitive effect. To be lawful, quantity discounts must be structured in a way that does not unfairly discriminate between customers or create barriers to market entry. They must be available to all customers, not short-term intended to disrupt competitors, and new businesses should have the capability to 'buy up' to reach the minimum quantity. Cumulative discounts should also not exceed a full calendar year, maintaining a level playing field and preventing long-term market distortions.
Moreover, despite price maintenance agreements being illegal if they set a minimum resale price, manufacturers may suggest prices and end relationships with retailers who consistently undercut these suggested prices.
In situations involving exclusive dealing agreements, they can be legal if their aim is to encourage competition among dealers. For instance, it’s permissible for automotive companies to have exclusive relationships with their branded dealerships. However, when a deal limits competition, such as a single retailer getting the exclusive rights to sell products from various companies, these arrangements can be considered anticompetitive.