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2. Why are telecom industries across different economies in the world, in general, oligopolies?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter11: Monopoly And Antitrust Policy

Section: Chapter Questions

Problem 20RQ: If public utilities are a natural monopoly, what would be the danger in deregulating them?

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2. Why are telecom industries across different economies in the world, in general, oligopolies?
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2. Which is a better market structure, Monopoly or Oligopoly? Why?
2. Define economies of scale, scope, and network externality effects within the context of telecommunication. How can a firm take advantage of them to monopolize the market? How does a monopoly reach profit maximizing pricing?
1.ALCOA does not have the monopoly power it oncehad. How do you suppose their barriers to entry wereweakened? 2.For many years, the Justice Department has triedto break up large firms like IBM, Microsoft, and mostrecently Google, on the grounds that their large marketshare made them essentially monopolies. In a globalmarket, where U.S. firms compete with firms from othercountries, would this policy make the same sense as itmight in a purely domestic context?
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K To restrict a firm's monopoly power, why can't antitrust authorities just set a floor or a ceiling in the market? OA. It is difficult to set a fair price, so regulators do not get involved in the pricing decisions of any monopolists. B. It is difficult to set a fair price, and even if regulators did, the firm would then have no incentive to innovate. C. The government does not have the power to dictate what a firm can charge; it can only stop mergers. D. Floors or ceilings lead to inefficiency and deadweight loss, which can be avoided if the monopoly sets its own price.
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