Wednesday, August 17, 2011

Vickrey has a theorized that users pay the public goods at their marginal cost, the fix costs can be paid for?

at marginal cost then no one would make a profit. if that happened then what reason would there be to go into business. Products have built in profits and everyone else try to under cut it by lowering cost so they can maintain the same profit and sell more. The first iphone 500 bucks. Someone else is going to knock it off for 400. anyways marginal cost isnt as steep as is shown by books as more and more units is produced.

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