You Are the Owner of a New Network That Is

question 40

Essay

You are the owner of a new network that is superior to an existing two-way network.The network you aim to replace currently has 50 users,each of whom is willing to pay an average of $75,000 for each connection service within the current network.You are confident that each user values connection services within your new two-way network at an average of $100,000 per connection service.
a.What is the maximum price the existing network can charge each user for its services?
b.Devise a pricing strategy that will permit your firm to overcome the first-mover advantage enjoyed by the existing network.

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Definitions:

Public Policy

The principles and actions adopted or proposed by a government or organization to address public issues, concerns, or the welfare of the community.

Justified Punishment

A penalty deemed appropriate and rightful, given in response to a violation of laws or ethical standards.

Greater Balance

The concept of achieving a more equitable or harmonious distribution in various aspects of life or systems.

Act Utilitarianism

A form of utilitarianism that assesses each separate act according to whether it maximizes pleasure or minimizes pain, focusing on the consequences of individual actions.