The Accompanying Table Shows a Small Community's Demand for Monthly

question 48

Multiple Choice

The accompanying table shows a small community's demand for monthly subscriptions to a streaming movie service.Assume that only two firms (Nextflix and Flixbuster) sell in this market,that each firm offers the same quality of service and movie selection,and that each firm's marginal cost is constant and equal to 0 (zero) due to excess capacity.Use this information to answer the questions that follow.

-If the two firms operating in this market agreed to each supply one-half of the quantity a monopolist would supply,the contract would specify that:

• A)Nextflix supplies 400 subscriptions and Flixbuster supplies 100 subscriptions.
• B)Flixbuster supplies 400 subscriptions and Nextflix supplies 100 subscriptions.
• C)Nextflix supplies 0 (zero)subscriptions and Flixbuster supplies 500 subscriptions.
• D)Flixbuster supplies 500 subscriptions and Nextflix supplies 0 (zero)subscriptions.
• E)Nextflix supplies 250 subscriptions and Nextflix supplies 250 subscriptions.

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