Table 17-7 The Information in the Table Below Shows the Total Demand

question 130

Multiple Choice

Table 17-7
The information in the table below shows the total demand for internet radio subscriptions in a small urban market. Assume that each company that provides these subscriptions incurs an annual fixed cost of $20,000 (per year) and that the marginal cost of providing an additional subscription is always $16.
-Refer to Table 17-7. Assume that there are two profit-maximizing internet radio providers operating in this market. Further assume that they are not able to collude on the price and quantity of subscriptions to sell. How much profit will each firm earn when this market reaches a Nash equilibrium?

• A)$12,000
• B)$16,000
• C)$52,000
• D)$64,000

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Definitions:

Reengineering

A process of redesigning business processes and organizational structures to achieve significant improvements in critical aspects like quality, output, cost, service, and speed.

Innovation

The process of creating and implementing new ideas, methods, or products to improve efficiency, effectiveness, or competitive advantage.

Functional Departmentalization

A method of organizing a company's structure based on specialized functions, such as marketing, finance, and operations.

Geographic

Relating to the physical features of the earth or the distribution of populations, often influencing environmental, economic, and social patterns.