Prior to the advent of MCI (later named Worldcom) the ...

[HudsonKB16]

Prior to the advent of MCI (later named Worldcom) the telecommunications industry largely relied on one kind of technology  the copper wire.
 
  Why do you suppose that the use of microwave technology employed by MCI offered an important challenge to the principle of natural monopoly that existed at the time justifying the reliance on one company  AT&T.

Question 2

What is meant by terms of trade? How is it determined?
 
  What will be an ideal response?

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Answer to Question 1

It meant that competing firms could effectively compete without having to replicate the infrastructure (that is fixed costs) of the sole existing firm  AT&T and be able to compete for customers at a lower cost.

Answer to Question 2

The terms of trade refers to the exchange rate of goods for goods. For example, if 170 apples are traded for 20 oranges, the terms of trade are 8.5 apples per orange. Terms of trade are determined on the basis of opportunity cost. For two people or countries to benefit from trade, the trading price must lie between their opportunity costs of producing the good in both countries.