A cable company can add a subscriber for ________ and a market failure occurs because the price charged ________.

Question

Quizplus · Accepted Answer

A cable company can add a subscriber for nearly zero marginal cost because once the infrastructure is in place, adding an additional customer does not require significant additional cost. However, if the company charges a price that exceeds marginal cost, a market failure occurs due to the presence of deadweight loss and inefficiency in the market.

A Cable Company Can Add a Subscriber for ________ and a Market