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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: NITT who wrote (252046)	5/20/2008 12:03:30 AM
From: Sarmad Y. Hermiz	Read Replies (1) \| Respond to of 275872

NITT, from your reading assignment. papers.ssrn.com In the U.S. federal courts, use of above cost loyalty discounts in the single product setting generally has been viewed as a pro-consumer form of price competition, and antitrust challenges to such programs have not been successful. ----------- Can someone pass the word to CJ and FPG. And please mention this is in the context of AMD's US suit, only. edit. another snippet. Shows economists don't like what courts do. ---- Tests for Anticompetitive Loyalty Discounts From an antitrust standpoint, the primary issue is how to distinguish pro and anticompetitive loyalty discounts. In the single product setting, cost based tests have been used to judge the lawfulness of loyalty discounts. Under these cost based tests, the lawfulness of a firm’s pricing conduct, including its use of loyalty discounts, is judged based upon whether the resulting prices are above or below an appropriate measure of cost (usually marginal cost, or long run average variable costs).23 Pricing below the appropriate measure of cost is presumed to be unlawful, while pricing above this benchmark is presumed to be lawful. Economists have suggested more refined cost-based predation tests.28 .... -------