The high fixed cost and marginal cost lead to significant market power with the normal inefficiencies. In particular the price will always exceed the marginal cost such that the price benefits due to price discrimination are significant to the participants.
Information technology allows observation and keen analysis of consumer behaviour and hence allows for the articulation of various market strategies that could not have been carried out before.
Faimus answered the question on February 10, 2018 at 16:07
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What is bundling and what are its economic effects
Date posted:
February 10, 2018
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February 10, 2018
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Briefly explain how information technology enhances productivity in an economy
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February 10, 2018
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February 10, 2018
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Date posted:
February 10, 2018
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Differentiate between transactions and batches as used in information systems
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February 10, 2018
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Highlight the major challenges facing the Business Processing Outsourcing sector in Kenya
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Define the following terms
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February 10, 2018
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February 8, 2018
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(Solved)
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Date posted:
February 7, 2018
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February 7, 2018
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February 7, 2018
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February 5, 2018
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February 3, 2018
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(Solved)
ICT has assumed an increasingly strategic role in the Kenyan economy in the recent years. Between 2000 and 2012, the country's wider transport and communication sector, of which ICT is a part, grew at a compound annual rate growth of 7.7%, outperforming all other sectors of the national economy. During the recent economic slowdown the sector was not affected as much as other sectors of the economy. Explain how IT dampens the severity of business cycles.
Date posted:
February 3, 2018
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Answers (1)
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(Solved)
Discuss the three types of price discrimination in relation to information technology.
Date posted:
February 3, 2018
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Answers (1)