The software business is extremely profitable compared to the hardware business because:
A) the marginal cost to produce an additional copy of a software product is effectively zero.
B) of the lack of market price regulations and guidelines.
C) software producers serve niche businesses sectors with high profit margins.
D) software development is a one-time process with no upgrade costs.
E) software firms benefit from special tax exemptions that aid profitability.

Question

Quizplus · Accepted Answer

The marginal cost of producing an additional copy of a software product is almost zero, as software is essentially a series of instructions that can be duplicated at no extra cost. This allows software companies to achieve high profit margins, even if they sell their product at a lower price point compared to hardware products.

The Software Business Is Extremely Profitable Compared to the Hardware