There Are Two Existing Firms in the Market for Computer

question 126

Multiple Choice

There are two existing firms in the market for computer chips.Firm A knows how to reduce the production costs for the chip and is considering whether to adopt the innovation or not.Innovation incurs a fixed setup cost of C,while increasing the revenue.However,once the new technology is adopted,another firm,B,can adopt it with a smaller setup cost of C/3.If A innovates and B does not,A earns $30 in revenue while B earns $10.If A innovates and B does likewise,both firms earn $20 in revenue.If neither firm innovates,both earn $10.Under what condition will firm A innovate?

• A) C > 30
• B) C < 30
• C) 10 > C > 0
• D) 35 > C > 25

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Definitions:

Developmental Psychologist

A specialist in psychology who studies the psychological growth of individuals, focusing on how people change over time from infancy through old age.

Personality Psychologist

A psychologist who studies variations in behavior, thinking, and emotion among individuals, focusing on traits and patterns that differentiate one person from another.

Cognitive Psychologist

A specialist in psychology who studies mental processes such as perception, memory, thinking, problem-solving, and language.

Organizational Psychologist

A professional who applies psychological theories and principles to organizations, focusing on improving workplace productivity, and the mental health of employees.