Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Direct TV is deciding how to price rice Its service. Assume there is no competition in this market. The marginal cost to Direct TV is

image text in transcribed
Direct TV is deciding how to price rice Its service. Assume there is no competition in this market. The marginal cost to Direct TV is assumed to be zero. The following table describes the preferences of the representative consumer Movies per year Total Willingness to Pay ($) 25 48 69 105 120 133 144 153 160 165 168 169 14 169 favorite movies For example, the second row implies that the consumer would get $48 worth of happiness (in total) by watching his or her two (simple) pricing? f Direct TV charged a flat fee of $125 what would its incremental profit be in comparison with the optimal pay-per-vie $125 They are identical 5144

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Economics Of The Environment

Authors: Peter Berck, Gloria Helfand

1st Edition

978-0321321664, 0321321669

More Books

Students also viewed these Economics questions