Aiming to penetrate the e-book market, A Inc. colluded with five major publishers to help it enter the market by launching its iTablet and iBookstore features. It successfully encouraged all publishers to adopt an agency pricing model (i.e., publisher dictates the retail price, while the retailer sells as its agent) and to abandon the wholesale pricing model (i.e., publisher receives its designated wholesale price for each e-book, and the retailer sets the retail price). Is this arrangement anti-competitive? Briefly reason.
Aiming to penetrate the e-book market, A Inc. colluded with five major publishers to help it enter the market by launching its iTablet and iBookstore features. It successfully encouraged all publishers to adopt an agency pricing model (i.e., publisher dictates the retail price, while the retailer sells as its agent) and to abandon the wholesale pricing model (i.e., publisher receives its designated wholesale price for each e-book, and the retailer sets the retail price). Is this arrangement anti-competitive? Briefly reason.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Aiming to penetrate the e-book market, A Inc. colluded with five major publishers to help it enter the market by launching its iTablet and iBookstore features. It successfully encouraged all publishers to adopt an agency pricing model (i.e., publisher dictates the retail price, while the retailer sells as its agent) and to abandon the wholesale pricing model (i.e., publisher receives its designated wholesale price for each e-book, and the retailer sets the retail price). Is this arrangement anti-competitive? Briefly reason.
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