Which of the Following Is True of an Information Good

question 42

Multiple Choice

Which of the following is true of an information good or service?

• A) In order to maximize profits, firms should set a high price because information goods are expensive to produce.
• B) The profit-maximizing price should be equal to the average fixed cost of producing the information good.
• C) Information goods are provided for free because the production cost of an information good is zero.
• D) The smaller the number of consumers using an information good, the higher the value obtained by other consumers.
• E) Information goods or services are characterized by high fixed costs but low or negligible marginal costs.

---

Definitions:

White Bar

A horizontal or vertical screen space, often used in user interface design, that separates content or groups items visually.

Status Option

A selectable setting or command within a software's status bar or settings menu that alters the display or behavior of application features.

Originator

Refers to the person who creates or initiates something, such as an idea, project, or document.

New Meeting Time

The action or process of scheduling an alternate time for a previously planned meeting.