Before the Deregulation in Telecommunications,AT&T Charged Higher Rates on Long-Distance

question 131

Multiple Choice

Before the deregulation in telecommunications,AT&T charged higher rates on long-distance service in order to make local service rates lower.Such a practice is an example of

• A)Price discrimination because different prices were charged for the same service.
• B)The pricing of public goods.
• C)Cross-subsidization of local phone service.
• D)Predatory price cutting to eliminate local telephone companies.

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Definitions:

Straight-Line Method

A depreciation technique that allocates an equal amount of depreciation each year over an asset's useful life.

Scrap Value

The estimated value that an asset will realize upon its sale at the end of its useful life.

Units-Of-Production Method

A method for determining depreciation that distributes depreciation based on how much the asset is used.

Scrap Value

Scrap value is the estimated residual value of an asset at the end of its useful life, typically in terms of its material components.