Final answer:
A company's attempt to discourage competition by using sharp price cuts is called predatory pricing. It is a form of creating barriers to entry and is illegal under U.S. antitrust law, although challenging to prove. Other anti-competitive practices include tie-in sales, bundling, and guarding trade secrets.
Step-by-step explanation:
An attempt to prevent people from buying products from a company is often referred to as a boycott. However, in the context of preventing competition in a market, which is a business strategy, this is known as predatory pricing.
Predatory pricing occurs when an existing firm uses temporary sharp price cuts to discourage new competitors from entering the market. This strategy creates a barrier to entry and can maintain or create a monopoly, as new firms are intimidated and deterred from competing. Such practices, under U.S. antitrust law, are illegal but can be hard to prove in court.
Companies sometimes engage in other restrictive practices like tie-in sales, bundling, and using trade secrets to stifle competition. These strategies, along with predatory pricing, raise significant concerns within antitrust law because they can lead to reduced competition, higher prices, and less innovation in the market.