An Economic Analysis of "Planned Obsolescence" Shows That

question 1

Multiple Choice

An economic analysis of "planned obsolescence" shows that

• A) monopolies have an incentive to produce shorter-lived products,even when longer-lived products can be produced at the same cost.
• B) firms prefer to produce shorter-lived products,because these result in greater sales and hence larger profits.
• C) competitive firms are forced to produce the product with greatest longevity,but monopolies can successfully use planned obsolescence.
• D) firms will make a longer-lived product if the additional cost is less than the present value of the benefits received by consumers.