Which of the following is true about vertically fixed prices?

Vertically fixed prices refer to a scenario in which manufacturers set the prices at which retailers must sell their products, creating a consistent pricing structure across different sales channels. This practice can reduce the effectiveness of market competition because it limits the ability of retailers to engage in competitive pricing strategies. When retailers are bound to sell products at a fixed price, it diminishes price competition among them, as they cannot adjust prices to attract customers. This can ultimately lead to less competitive markets and potentially higher prices for consumers.

Option A, stating that prices are set by retailers without input from manufacturers, contradicts the very definition of vertically fixed pricing, which involves manufacturer control. Option C addresses market share of wholesalers, which is not directly relevant to the concept of fixed retail prices. Lastly, option D limits the scope of vertically fixed pricing to online sales only, while it can actually occur across various sales channels, including physical retail locations.

Thus, the correct understanding of vertically fixed pricing highlights its impact on market competition, making statement B the accurate choice.