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If it's expected that the incomes of people living in rural Nigeria is expected to increase, what will the equilibrium outcome be, ceteris paribus?

If it's expected that the incomes of people living in rural Nigeria is expected to increase, what will the equilibrium outcome be, ceteris paribus?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question 18 Suppose that the pricing strategies for FiberOne and of Starlink are shown in the table below. They have to decide whether to charge a high or low price for their internet service. The four pairs of payoff values show what each company expects to earn or lose in millions of dollars, depending on what the other company does. Starlink's Price Strategy High Price Low Price FiberOne's Price Strategy Low Price High Price Starlink+$200 FiberOne +$200 Starlink-$100 FiberOne +500 a)-3 b) 0 c) 2.5 d)-0.55 Starlink+$500 FiberOne-$100 Starlink+$100 FiberOne +$100 If it's expected that the incomes of people living in rural Nigeria is expected to increase, what will the equilibrium outcome be, ceteris paribus? a) Starlink will charge a low price; FiberOne will charge a high price. b) Starlink will charge a high price; FiberOne will charge a low price. c) Both Starlink and FiberOne will charge a low price. d) Both Starlink and FiberOne will charge a high price. Question 19 Which of the following figures is most likely to represent the cross-price elasticity of demand of FibreOne internet services to Starink internet services.
Transcribed Image Text:Question 18 Suppose that the pricing strategies for FiberOne and of Starlink are shown in the table below. They have to decide whether to charge a high or low price for their internet service. The four pairs of payoff values show what each company expects to earn or lose in millions of dollars, depending on what the other company does. Starlink's Price Strategy High Price Low Price FiberOne's Price Strategy Low Price High Price Starlink+$200 FiberOne +$200 Starlink-$100 FiberOne +500 a)-3 b) 0 c) 2.5 d)-0.55 Starlink+$500 FiberOne-$100 Starlink+$100 FiberOne +$100 If it's expected that the incomes of people living in rural Nigeria is expected to increase, what will the equilibrium outcome be, ceteris paribus? a) Starlink will charge a low price; FiberOne will charge a high price. b) Starlink will charge a high price; FiberOne will charge a low price. c) Both Starlink and FiberOne will charge a low price. d) Both Starlink and FiberOne will charge a high price. Question 19 Which of the following figures is most likely to represent the cross-price elasticity of demand of FibreOne internet services to Starink internet services.
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If the average rural household income in Nigeria is US$60 then the demand for internet
connectivity, ceteris paribus, at US$43 is more likely to be... 

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