Software Development Has High Fixed Costs and Marginal Costs That

question 44

Multiple Choice

Software development has high fixed costs and marginal costs that are close to zero. What would happen if software firms sold their product for marginal cost?

• A) They would have the incentive to produce new software programs.
• B) They would produce better software.
• C) They would increase their profits.
• D) They would not be able to afford their fixed costs and would go out of business.

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Definitions:

Plasma

The liquid component of blood, composed of water, salts, proteins, and various other substances, in which blood cells are suspended.

Transferrin

A plasma protein that transports iron throughout the body.

Erythrocytes

Red blood cells that are primarily responsible for carrying oxygen and carbon dioxide throughout the body.

Amino Acids

Organic compounds that combine to form proteins, which are the building blocks of life.