Managerial Economics 13th Edition by James McGuigan,Charles Moyer,Frederick Harris

Exercise 7

Which of the following is a violation of the antitrust laws in the United States and why (a) Microsoft monopolizes the market in PC operating systems with a 92 percent market share; (b) Microsoft attempts to monopolize the market in Internet portals with a pattern of anticompetitive tactics (tying arrangements, refusals to deal, etc.); (c) Microsoft sells Windows plus Microsoft Internet Explorer for less than Windows without Internet Explorer installed as the default browser; (d) Microsoft gives Internet Explorer away free to individual adopters with variable cost estimated at $0.0067; (e) Microsoft threatens to delicense Compaq and Dell, who would then be unable to preinstall Windows on PCs they ship unless Compaq and Dell exclude Netscape's Internet browser from the user interface.