Description: The federal government has told Canada’s big 3 telecoms – Bell, Rogers, and Telus – to cut their cellphone rates by 25%, or else. Innovation, Science and Industry Minister Navdeep Bains told the companies that if they don’t take action within two years, then the politicians will step in to force them to. On the company side, the response seems to be that cutting rates could result in declining capital investment or even court challenges.
Date: March 5, 2020
1) How much are you paying for your cell service? How does this compare to what your classmates are paying?
2) Do you think that a government should order a private enterprise to cut its prices?
3) Wiley’s Financial Accounting : Tools for Business Decision-Making talks about accounting for research and development costs on page 485. Do you think the government’s action might impact the telecom’s spending on R&D?