Write a short essay (350-400 words) answering the questions regarding Safeway, its alleged attempts at creating a monopoly, and the government's intervention. Include both sides of the argument: why the government got involved, and why it shouldn't have gotten involved.
In addition, select one additional question from those at the end of Chapter 11, using the same short essay word requirements as stated above.
After 25 years, the U.S Justice Department agreed to drop a consent decree that it had extracted from Safeway, under which Safeway had been prohibited from selling at prices below its cost of acquiring grocery products or at 'unreasonably low prices" that might be above cost. The decree stemmed from a government suit that had accused Safeway of selling below cost in an effort to monopolize the market for retail food in Texas and new Mexico.
How likely is it that Safeway or anyone else would be able to monopolize the market for retail food in two states?
The alleged attempt to monopolize led Safeway to reduce prices to customers. Who do you suppose complained to the Justice Department about Safeway behavior?
What is the appropriate way to determine the cost of specific grocery items? Is a retailer selling paper bags below cost wen it makes them available to customers at no charge? Is the retailer cross-subsidizing paper bags?