Increasing returns and imperfect competition: Suppose a new piece of computer softwaresay a word processor with perfect speech recognitioncan be created for a onetime cost of $100 million. Suppose that once it's created, copies of the software can be distributed at a cost of $1 each. If Y denotes the number of copies of the computer program produced and X denotes the amount spent on production, what is the production function; that is, the relation between Y and X? Make a graph of this production function. Does it exhibit increasing returns? Why or why not? Suppose the firm charges a price equal to marginal cost ($1) and sells a million copies of the software. What are its profits? Suppose the firm charges a price of $20. How many copies does it have to sell in order to break even? What if the price is $100 per copy? Why does the scale of the marketthe number of copies the firm could sellmatter