Regulation and Antitrust Policy (Econ 180)
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Course page:
www.drake.edu/cbpa/econ/boal/180
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I. Multiple choice [2 pts each: 20 pts total]
(1)c. (2)d. (3)b. (4)a. (5)d. (6)d. (7)b. (8)a. (9)d. (10)b.
II. Problems
(1) [Cases: 10 pts]
(2) [Monopoly price discrimination: 6 pts]
(3) [Predatory pricing: 33 pts]
(4) [Perfect price discrimination: 26 pts]
III. Challenge question
This was not a simple case of predatory pricing. Profitable predatory pricing requires a period of predation (where profit is below normal or even negative) followed by a period of recoupment (where profit is above normal). But even today, the price of Internet Explorer remains zero. So Microsoft never enjoyed a period of recoupment.
I. Multiple choice [2 pts each: 20 pts total]
(1)a. (2)b. (3)d. (4)c. (5)d. (6)b. (7)d. (8)b. (9)a. (10)d.
II. Problems
(1) [Cases: 10 pts]
(2) [Monopoly price discrimination: 6 pts]
(3) [Predatory pricing: 33 pts]
(4) [Perfect price discrimination: 26 pts]
III. Challenge question
Same as Version A.
[end of answer key]