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The European demand for access to satellite transmissions can be divided into three groups: A, B, and C. The demand curves for the three groups
The European demand for access to satellite transmissions can be divided into three groups: A, B, and C. The demand curves for the three groups are: PA = 500 2QA (for Q < 250), PB = 300 QB (for Q < 300), and PC = 400 2QC (for Q < 200), where Q = number of hours access per month, and P = price per hour. Satellite transmission is a pure public good with zero marginal cost. (a) Explain the difference between horizontal and vertical summation of demand curves and the circumstances in which each type of summation is appropriate.
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