What happens when a product is path dependent?
a. The technology used to produce the product has a specific growth path.
b. The product can sell for a higher price when it is new and there are no similar products consumers
can buy than when it is older and consumers can choose to buy substitutes for the product.
c. The cost of switching to a product with a better technology gives the product with the initial
technology an advantage.
d. The path that a product follows depends on the firm that uses the best technology to produce it.
c. The cost of switching to a product with a better technology gives the product with the initial
technology an advantage.
You might also like to view...
If a natural monopoly is regulated using the marginal cost pricing rule, how does the regulation affect prices, outputs, profits, and the distribution of surpluses? What are the pros and cons to this method of regulation?
What will be an ideal response?
Scarcity is: a. only a problem in modern industrialized economies
b. only a problem in impoverished economies. c. only a problem in centrally planned economies. d. a problem that necessitates making choices and tradeoffs.
The U.S. Treasury used the First Bank of the United States for all of the following purposes except _____.
(A) To issue representative money. (B) To set interest rates. (C) To hold money generated by taxes. (D) To help the government carry out its powers to tax.
In a Bertrand duopoly with product differentiation, explain how a change in one firm's marginal cost can have an effect on the price charged by the other firm
What will be an ideal response?