December 1991 LSAT Section 3 Question 16

Which one of the following distinctions between monopoly power and the abuse of monopoly power would the author say u...

BritneyS on July 21, 2023

Why is it E?

The passage says that supra competitive prices ultimately lower consumer welfare but is NOT considered abuse of a monopoly. So how would E be right in saying that abuse of a monopoly is when consumer welfare is being impacted when this example in the passage says otherwise in that is is not an example of monopolistic abuse?

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Emil-Kunkin on August 1, 2023

I think that SC prices are only one example of monopoly power. The passage goes through another example of monopoly power in paragraph three, in which I don't think we know for sure if the Walmart like firm is using sc prices. This is an example of monopoly power actually increasing welfare, at least in theory. I think the final paragraph is the best evidence we have for E. It more or less tells us that the point of antitrust law is to max consumer welfare.