Discuss legality of this arrangement under the sherman act

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Frank markets throughout Wisconsin and Iowa. His primary competitor is Carol, who sells throughout Wisconsin, Illinois, Iowa, and Minnesota. At a trade meeting in New York, Frank and Carol had lunch together. They acknowledged their competition in Wisconsin and Iowa was expensive. They both were losing money in these two states. They agreed that it made no sense to beat up on each other in price competition. Instead, Carol agreed to sell only in Iowa and Frank would sell only in Wisconsin, where his plant is located. They agreed that this arrangement would permit them to offer consumers the cheapest prices and still make a reasonable profit. Please discuss the legality of this arrangement under the Sherman Act.

Reference no: EM131780996

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