Table 17-4

question 14

Multiple Choice

Table 17-4. The information in the table below shows the total demand for high-speed Internet subscriptions in a small urban market. Assume that each company that provides these subscriptions incurs an annual fixed cost of $200,000 (per year) and that the marginal cost of providing an additional subscription is always $80.

-Refer to Table 17-4.Assume there are two high-speed Internet service providers operating in this market.Further assume that they are not able to collude on the price and quantity of subscriptions to sell.What price will they charge for a subscription when this market reaches a Nash equilibrium?

• A) $120
• B) $160
• C) $200
• D) $240

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Definitions:

Major Repairs

Expenditures that substantially extend the useful life of an asset or improve its functionality, as opposed to regular maintenance.

Insurance

Insurance is a financial product that provides protection against potential future losses or damages, in exchange for premium payments.

Intracompany Comparison

This involves comparing financial data or performance indicators within the same company over different time periods to assess trends or improvements.

Horizontal Analysis

An analysis method where financial statement items are compared across different periods, to identify trends or significant changes over time.