Suppose that a 20 percent cut in the price of coast-to-coast telephone calls brings in so much

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Suppose that a 20 percent cut in the price of coast-to-coast telephone calls brings in so much new business that it permits a long-distance telephone company to cut its charges for service from Chicago to St. Louis, but only by 2 percent. In your opinion, is this practice equitable? Is it a good idea or a bad one?
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Economics Principles and Policy

ISBN: 978-0538453653

12th edition

Authors: William J. Baumol, Alan S. Blinder

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