Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose that Shaw Communications has a cable monop_o|y_ in Vancouver. The following table gives Shaw's demand and costs per month for subscriptions to basic cable

image text in transcribed
image text in transcribed
Suppose that Shaw Communications has a cable monop_o|y_ in Vancouver. The following table gives Shaw's demand and costs per month for subscriptions to basic cable (for simplicity, we keep the number of subscribers articially small). Assume fixed costs equal $45. Total Marginal Total Marginal Price Quantity Revenue Revenue Cost Cost $51.00 3 $153.00 $108.00 48.00 4 192.00 39.00 129.00 21.00 45.00 5 225.00 33.00 153.00 24.00 42.00 6 252.00 27.00 180.00 27.00 39.00 7 273.00 21.00 210.00 30.00 36.00 8 288.00 15.00 243.00 33.00 a. Suppose the local government imposes a $75 per month tax on cable companies. What will Shaw do? .;' A. Shaw should produce 6 units in the short run and in the long run. . Shaw should shut down in the short run and in the long run. . Shaw should shut down in the short run and produce 6 units in the long run. . Shaw should produce 6 units in the short run and shut down in the long run. None of the above

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored 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

Microeconomics Principles For A Changing World

Authors: Eric Chiang

4th Edition

1464186677, 978-1464186677

More Books

Students also viewed these Economics questions