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Consider the market for high-speed internet in Pandora, where your company is the only provider. The marginal cost of providing internet access to one more
Consider the market for high-speed internet in Pandora, where your company is the only provider. The marginal cost of providing internet access to one more customer is negligible (zero). Suppose this firm faces a fixed cost of maintaining the network of $50,000 per month. A marketing study has estimated that there are some 10,000 high-demand consumers (A) and 10,000 low-demand consumers (B), whose willingness to pay for different connection speeds is given below:
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