Which federal statute prohibits price discrimination among purchasers that may limit competition?

The correct answer identifies the specific legal framework under which price discrimination is addressed in the context of limiting competition. The Clayton Act of 1914, particularly Section 2, is crucial in prohibiting discriminatory pricing practices that can disadvantage certain purchasers. This statute aims to promote fair competition by preventing sellers from setting different prices for the same goods to different buyers, which could distort market competition.

This section applies to competitive conditions as it prevents larger firms from engaging in practices that could lead to monopolistic behavior by disadvantaging smaller competitors through unfair pricing. Price discrimination can create barriers for less dominant purchasers, potentially leading to a less competitive market overall.

While the other options relate to antitrust laws and competition, they focus on different aspects of market behavior. The Sherman Act generally addresses broader antitrust issues, such as conspiracy or restraint of trade, while the Clayton Act's other sections deal with mergers and acquisitions. The Federal Trade Commission Act primarily establishes the Federal Trade Commission and prohibits unfair or deceptive acts or practices, rather than specifically targeting price discrimination.

This targeted approach in Section 2 of the Clayton Act helps ensure that all competitors can fairly engage in business practices without unfair pricing manipulations, thereby serving to maintain an equitable competitive landscape in the market.