The Telecommunications Regulatory Authority (TRA) isthe UAE’s independent industry regulator…

The Telecommunications Regulatory Authority (TRA) isthe UAE’s independent industry regulator. Sinceits launch in1976, Etisalat has held a monopoly inthe market. That changed in2006 with the emergence ofdu, which was awarded a 20-year concession tooperate fixed-line, wireless, internet and international telecoms services. UAE-based telecom operator recently announced that itwas launching Virgin Mobile as a new telecom brand within the country. Assuming the trend continues and the government opens the market for more private and foreign players. You are required to–

a. Apply your understanding and concepts from microeconomics, to investigate and summarize the majorcharacteristics ofthe emerging market form inthe telecomindustry.

b. Describe and analyze the pricing policies that you would expect to find inthisindustry.

c. Explain the profit maximization strategy ofthis market form with the help of a suitable graph.

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