What do many economists believe is the valid reason behind resale price maintenance?

Show Answers

It serves to prevent discount sellers from benefiting unfairly from the services offered by full-service retailers.It constitutes price fixing and is thus illegal.It is a form of price fixing, making it unlawful, while also increasing the producer's market control.It increases the producer's dominance in the market.

Explanation

Many economists argue that resale price maintenance is justified as it prevents discount retailers from free riding on the services provided by full-service retailers. Although some view it as price fixing and illegal, its main purpose is to protect service investments made by full-service sellers.