The owner of a network will always want to be compatible with other networks in order to take advantage of network economies
Indicate whether the statement is true or false
F The incentive to take advantage of network economies can be strong. But it is conceivable that opening to another network will bring more competition that can be more costly to one network than the economies it offers, in which case the owner will not seek compatibility.
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Suppose a monopoly firm has an annual demand function of Qd = 20,000 - 250P, annual variable costs of VC = 16Q + 0.002Q2 and marginal cost of MC = 16 + 0.004Q, where Q is the annual quantity of output. In addition, the firm has an avoidable fixed cost of $25,000 per year. If this firm maximizes its profit, what is the value of aggregate surplus?
A. $247,250 B. $272,250 C. $242,000 D. $217,000
If a firm experiences constant returns to scale at all output levels, then its long-run average total cost curve would
a. slope downward. b. be horizontal. c. slope upward. d. slope downward for low output levels and upward for high output levels.
Why is a construction worker never likely to earn as much as a famous athlete?
a. Compensating differentials create a higher wage for professional athletes. b. Technological progress has advanced less in the construction industry then in sports training. c. Productivity levels are low in the construction industry due to the high number of people willing to be construction workers. d. A construction worker can provide his services to only a limited number of customers.
The fastest growing economy between 1870 and 1979 was
a. the United Kingdom. b. the United States. c. Japan. d. Brazil.