Many large service organizations were at one time state-owned but have been privatized. Examples in some countries include electricity supply and telecommunications. They are often regulated. Similar systems of regulation of prices by an independent authority exist in many countries and are designed to act as a surrogate for market competition in industries where it is difficult to ensure a genuinely competitive market. Explain which aspects of cost information and systems in service organizations would particularly interest a regulator, and why these features would be of interest.
Many large service organizations were at one time state-owned but have been privatized. Examples in some countries include electricity supply and telecommunications. They are often regulated. Similar systems of regulation of prices by an independent authority exist in many countries and are designed to act as a surrogate for market competition in industries where it is difficult to ensure a genuinely competitive market. Explain which aspects of cost information and systems in service organizations would particularly interest a regulator, and why these features would be of interest.
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter23: Managing Vertical Relationships
Section: Chapter Questions
Problem 4MC
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Many large service organizations were at one time state-owned but have been privatized. Examples in some countries include electricity supply and telecommunications. They are often regulated. Similar systems of regulation of prices by an independent authority exist in many countries and are designed to act as a surrogate for market competition in industries where it is difficult to ensure a genuinely competitive market.
Explain which aspects of cost information and systems in service organizations would particularly interest a regulator, and why these features would be of interest.
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