Question 87

This is price-fixing.

A small broker committee setting a fixed, non-negotiable commission rate for all listings constitutes price-fixing, as it involves an agreement among competitors to set prices at a certain level rather than allowing market forces to determine them.

A) apostille.

Apostille refers to a certification that verifies the authenticity of a document for international use, which is unrelated to the concept of commission rates or pricing strategies among brokers. Thus, this option is incorrect.

B) price-fixing.

Price-fixing is the act of colluding to set prices at a certain level, which is exactly what the broker committee is doing by establishing a fixed, non-negotiable commission rate. This option correctly identifies the situation described in the question.

C) market allocation.

Market allocation involves competitors dividing markets among themselves to avoid competition, which does not apply to the scenario of setting a fixed commission rate. Therefore, this option is incorrect.

D) boycott.

A boycott refers to an organized refusal to deal with a particular entity or individual, which is not relevant to the establishment of a fixed commission rate. This option does not apply to the scenario presented.

Conclusion

The situation described in the question exemplifies price-fixing, as the committee's actions directly manipulate the commission rates that should be determined by competitive market forces. Other options, such as apostille, market allocation, and boycott, fail to capture the essence of the scenario. Therefore, option B is definitively the correct choice.