In Duopoly, Social welfare is maximized when ----------------------
A)there is one-way compatibility.
B)both machines are compatible.
C)both machines are incompatible to each other.
D)none of the above.

Question

Quizplus · Accepted Answer

When both machines (or products) in a duopoly are compatible, it allows for greater interoperability, consumer choice, and potentially lower prices due to competition on a level playing field. This can lead to an increase in consumer surplus and overall social welfare. Compatibility can also lead to increased innovation as companies strive to differentiate their products in other ways.

In Duopoly, Social Welfare Is Maximized When ----------------------