Question

Resale restrictions have been prosecuted under the sherman act. today, however, the courts apply the __________ in such cases and consider whether such restrictions have a "demonstrable economic effect."

Answer 1

Resale restrictions have been prosecuted under the Sherman Act. Today, however, the courts apply the rule of reason in such cases and consider whether such restrictions have a "demonstrable economic effect."

A rule of reason is when authorities step in to evaluated restrictive business practices and their anticompetitive effects to decide if the way they are going about their practices should be allowed or prohibited. This is used to help interpret the Sherman Antitrust Act and it's a huge part of the United States antitrust laws.