After a federal court judge had found Apple guilty of conspiring with book publishers to raise e-book prices, the Department of Justice recommended that the judge order Apple not to sign agency pricing model contracts with publishers for five years. The publishers objected to the recommendation, arguing that the recommendation would "effectively punish the [publishers] by prohibiting agreements with Apple using an agency model."
a. What is an agency pricing model?
b. Why would the Department of Justice want to keep Apple from signing agency pricing model contracts with publishers? Why would the publishers want to continue signing such contracts?