Refer to Scenario 13.2 below to answer the question(s) that follow. SCENARIO 13.2: The government of Stratospheria is currently inviting investors to bid for the exclusive right to provide cable television service to its residents. The market demand for this service is P=55-0.01Q, where Q is the number of households that would subscribe to the cable service and P is the monthly fee charged to the subscribers. The associated marginal revenue curve is MR=55-0.02Q. Fun Cable Company is interested in bidding for the right to provide cable service in Stratospheria. It has a constant average and marginal cost of $5 for providing cable service to each household.Refer to Scenario 13.2. If Fun Cable Company were to be awarded the exclusive right to provide cable service in Stratospheria,
how many households would it service?
A. 2,500
B. 2,750
C. 5,500
D. 5,000
Answer: A
You might also like to view...
Which of the following is included in M0, but not in M1?
A) demand deposits B) deposits of depository institutions at the Federal Reserve C) currency held by the U.S. public D) U.S. currency held by foreigners
TFC=Total Fixed CostQ=Quantity of OutputMC=Marginal CostP=Product PriceTVC=Total Variable Cost Refer to the above information. Average total cost is:
A. 
.
B. TVC - MC.
C. 
.
D. 
.
A $10 per-unit tax on cell phones raises the equilibrium price paid by consumers by $5. Before the tax, 5,000 cell phones were sold per year. The revenue from the tax is
A) zero. B) positive but less than $50,000 per year. C) $50,000 per year. D) more than $50,000 per year.
If the Chinese government were to begin selling large quantities of its dollar-denominated assets, how might that affect China's economy and the U.S. economy?
What will be an ideal response?