Which situation would most likely indicate there is no illegal monopoly under Section 2 of the Sherman Act?

Study for the CLEP Business Law Test. Engage with flashcards and multiple choice questions, each question has hints and explanations. Prepare effectively for your exam!

The situation that indicates there is no illegal monopoly under Section 2 of the Sherman Act is the one where the company has a significant market share, but competitors offer substitutable products.

Under the Sherman Act, particularly Section 2, an illegal monopoly typically involves maintaining or acquiring market power in a way that stifles competition. However, having a significant market share alone does not indicate the presence of a monopoly if there are viable competitors in the market providing substitute products. The existence of substitutable products means that consumers have alternative choices, which helps maintain competitive dynamics. This competition can prevent any one company from dominating the market to the detriment of consumers, thereby indicating that no illegal monopolistic behavior is occurring.

In contrast, the other scenarios involve elements that can potentially be indicative of monopolistic activities. For instance, acquiring small competitors can lead to reduced competition, pressuring customers to exclude rivals can create barriers for competitors, and holding a patent on a product can limit the ability of others to compete unless accompanied by further competitive practices.

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