Read the following scenario and answer the question in 5 sentences at least. You
ID: 351408 • Letter: R
Question
Read the following scenario and answer the question in 5 sentences at least.
You are the president of the American Association of Construction Manufacturers (AACM), a trade association that represents seven hundred companies who build and sell heavy construction equipment. Members have proposed a number of initiatives to advance AACM interests. First, some members want an AACM advocacy group to lobby Congress for relaxing trade barriers on importing raw materials and parts. Second, some of the smaller AACM members want an advertising campaign promoting the importance of the AACM in order to increase small firm membership. Third, some members propose to segregate regions of the United States into sales territories, whereby only certain members have access to certain customers within a geographic area. Fourth, a group of socially conscious AACM firms want its members to boycott a large supplier that sources from nations with poor human rights records. Evaluate the business and legal (antitrust) implications of each of these proposals.
Explanation / Answer
The Business Implication is described in the Left of table and Legal Implication is described on the Right of Table.
1. Lobbying efforts
2. Advertising Campaign
3. Forming Sales territory.
4.Boycott of Supplier
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Relaxation of Trade barrier will help each members to expand his target costumer base at lower costs. In addition to this, they would also be able to in-source better quality raw materials and thus produce better quality goods if the barriers are relaxed. In addition to this, by properly managing supply chain, they would also be able to transfer the cost benefit of this initiative to the customers. Last but not the least, it will create an open market situation which will encourage more competitors and thus strengthening the association more. Lobbying in some states are considered to be unlawful and is also related to Bribery and hence, is punishable under the law. Moreover, any documented lobbying effort might lead to loss of accreditation of the association and thus weakening the position of the association to a great extent.Related Questions
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