Essay on 1. Describe the market for telephony services prior to the enactment of the 1996 Telecommunication Act in Germany

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ECON 503 Alternative Assignment
In the following pages there are responses required and questions based on four cases. You may substitute the alternative assignment for your lowest exam score among the first 4 (microeconomics) exams. The assignment requires you to submit responses for any 3 of the 4 cases.
You may work collaboratively with other students. I will assign the same grade to all team members. I will expect more from teams than from individuals. You must submit your responses by the Friday at the end of week 5. Your responses must be in the form of word documents in which you provide your response to each item following the item. (In other words, insert your responses in this document.)

Pricing at Deutsche Telekom

Case Summary

Which parts of the textbook are most related?

Discussion Questions

1. Describe the market for telephony services prior to the enactment of the 1996 Telecommunication Act in Germany. Why is it unlikely that DT would face new competition in the market for retail fixed-line telecommunication services prior to 1996?

2. In what forms could local-level wholesale access to DT’s fixed-telephone network take? Describe the price structure for wholesale access to this network. Describe how wholesale DT’s wholesale prices were regulated.

3. Describe the connection technologies available to retail consumers. What were DT’s price structures for these connection technologies? How were retail prices in the market for telephony services regulated?

4. Explain the concept of a “margin squeeze.” Outline DT’s argument for why its pricing practices do not constitute a margin squeeze. Outline the counter argument.

5. Explain any other course concepts not covered in the discussion questions that you think apply.

Quoting Convention of NASDAQ Dealers Prompts a Justice Department Probe

Case Summary

Relevant Textbook Material

Discussion Questions and Answers

1. What role do market makers play in the trading system? How do they profit from this role? How do the market makers compete with one another?

2. How does the NASDAQ quoting convention work?

3. How do the market makers enforce the quoting convention?

4. What elements are necessary to make a convention such as this work? Were these present in this case?

5. What is the result of this type of quoting convention?
6. Explain any other course concepts not covered in the discussion questions that you think apply.

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