Always There Wireless is wireless monopolist in a rural area. There are 200 customers, each of whom has a monthly demand curve for wireless minutes of Qd = 200 - 100P, where P is the per-minute price in dollars and Q is the number of wireless minutes. The marginal cost of providing the wireless service is $0.25 per minute. If Always There charges $0.50 per minute and the largest fixed fee that it can at that price, what is the difference in profit per customer compared to when it charges $0.25 per minute and the largest fixed fee that it can at that price?
A. Profit per customer is the same in both cases, and it is equal to zero.
B. Profit per customer is the same in both cases, and it is positive.
C. Profit is $3.13 per customer higher at a price of $0.50.
D. Profit is $3.13 per customer higher at a price of $0.25.
C. Profit is $3.13 per customer higher at a price of $0.50.
You might also like to view...
If 1 US dollar costs 1.25 Euros, then 1 Euro must cost _____ US dollars
a. 0.5 b. 0.8 c. 1.0 d. 1.25 e. 1.5
Government intervention in agricultural markets in the U.S. began
A) during the Korean War. B) during World War II to ensure that enough food was available for domestic consumption. C) after World War I in order to assist farmers to adjust from a war-time economy to a peace-time economy. D) during the Great Depression.
Suppose Ethan and Ava work in a farm that grows apples and oranges of the same size. In one hour, Ethan can pick 8 pounds of apples or 1 pound of oranges. Ava can pick 6 pounds of apples or 1 pound of oranges. It can be concluded that
A) Ava has a comparative advantage in picking apples. B) Ava has an absolute advantage in picking apples. C) Ethan has a comparative advantage in picking apples. D) Ethan has an absolute advantage in picking oranges.
Which of the following economies have the highest degree of economic freedom?
What will be an ideal response?