Table 17-2
the Information in the Following Table Shows the Total

question 6

Multiple Choice

Table 17-2
The information in the following table 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.
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$$\begin{array} { | c | c | } \hline \begin{array} { c } \text { Quantity Demanded } \\\text { (Internet radio } \\\text { sub scriptions) }\end{array} & \begin{array} { c } \text { Price } \\\text { (Dollars per subscription } \\\text { per year) }\end{array} \\\hline 0 & 64 \\\hline 500 & 60 \\\hline 1,000 & 56 \\\hline 1,500 & 52 \\\hline 2,000 & 48 \\\hline 2,500 & 44 \\\hline 3,000 & 40 \\\hline 3,500 & 36 \\\hline 4,000 & 32 \\\hline 4,500 & 28 \\\hline 5,000 & 24 \\\hline 5,500 & 20 \\\hline 6,000 & 16 \\\hline 6,500 & 12 \\\hline 7,000 & 8 \\\hline 7,500 & 4 \\\hline 8,000 & 0 \\\hline\end{array}$$ ​
-Refer to Table 17-2. Assume there are two profit-maximizing internet radio providers operating in this market. Further assume that they are able to collude on the quantity of subscriptions that will be sold and on the price that will be charged for subscriptions. If the firms divide the market evenly, how much profit will each company earn?

• A)$12,000
• B)$16,000
• C)$44,000
• D)$60,000

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Definitions:

Informed Consent

A process in which a participant is fully informed about the procedures and risks involved in a study and voluntarily agrees to participate.

Human Welfare

Refers to the general health, happiness, and safety of a person or society.

Meta-Analysis

A statistical technique that combines the results of multiple studies to determine overall trends.

Significance Testing

A statistical method used to determine if the results of a study are likely to be true, or if they occurred by chance.