What is the first type of price maintenance?

• A. Predatory pricing
• B. Refusals to supply products or discrimination against other persons engaged in business based on their low pricing policy
• C. Bulk discount discrimination
• D. Price matching with competitors

Answer: (B)

Price maintenance is about keeping resale prices from falling by controlling how goods are distributed. The first type is refusals to supply or discrimination against dealers who pursue a low pricing policy. In practice, a supplier can cut off or penalize dealers who price too low, which directly discourages low-price competition across the channel and helps maintain higher prices overall.

Predatory pricing, by contrast, lowers prices to drive competitors out, which is a different tactic aimed at market elimination rather than channel-based price control. Bulk discount discrimination involves offering different volume-based discounts, not restricting supply to enforce a minimum price. Price matching with competitors is a reactive strategy to align with others’ prices, not a method of maintaining higher prices through supply control.