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econlab015 - lviIv-l v HIIHFEHI v a u<1<J<JC...

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Unformatted text preview: lviIv-l . . v. HIIHFEHI v a... u <1<J<JC WOO®®® DDD Exercise Square: 0 at 1 pt: Ass'gnlnent Senna: 25% (5 at 20 pts} in ® Sorry, that's not correct. - The Right Price for Digital Music: Why99 cents per song is too much, and too little. Apple‘s 99—cents—for—everything model isn‘t perfect. What we needisa system thatwillconfinue to 1“de Remember thatthe supplycurveisamarginalcostcurve,amithemarginalsodal corporate coffers yet be fair to music lovers. The solution a __ _ __ : cost ofdownloading a song from the i'I‘unes store is zero. real—time commodities market Songs would be priced strictlyondemarxi Themore 9301,13 who download [a Sotheproducer surplusistheareaonthegraphabovethex—axisarxibelowthe partic1flarsong]...thehighertheprice[ofthatsong]willgo. - 1-99 ent downloa betw th - arxitheemflbrn'lmquantttj' ,_ ...'I'hefewerpeoplewhobuya[parlicular]song,thelower .. .: priceo c sa 6, een ey—ams the price [ofthat song] goes. In essence, this is a pure flee—market solution—the market alone would determine price. Price cents erdownload 132- t ; p - ];- Producersmphlsistheprkereceivedforagoodmimmitsminimumsupply—price (or marginal cost) summed over the quantity sold. Slate, December S, 2005 The graph shows the market for downloadable music with a price of99 cents for everything. Assume that the marginal social cost ofdownbading a song is zero. Use the appropriate drawing tool to draw shapes that so 100 150 show the consumer surplus, the producer surplus, and the Quantity {downloads per month] deadweight loss. Labelthe three shapes. >>> Draw only.r the objects Specified in the question. Click a line or point to select it. (7) Al Fulfill-"Ii"! L Clear“! J L Check Answer J - L Save J |:I ...
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