Hurricane Prediction Pricing Strategy
A private company spent a significant amount of money to develop an algorithm that accurately predicts a hurricane's path. Once a prediction is made, it can be distributed to an unlimited number of people via the internet at no additional expense for each person who views it. The company proposes to sell this information to the public for $1 per person to recoup its development costs. Evaluate this pricing strategy from an economic efficiency perspective. Specifically, explain the problem with charging any positive price to an additional person who wants to view the prediction, given the cost structure of its distribution.
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Social Science
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CORE Econ
Economy
Economics
Introduction to Microeconomics Course
The Economy 2.0 Microeconomics @ CORE Econ
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