Answer to Question #70083 in Microeconomics for AKSHAY MODI

Question

1) What is the shape of marginal cost curve for Netflix in Australia?
2) The latest electric car is expected to be released in Australia shortly. What impact might this have on the market for battery powered bicycles?

Answer 1

1) The marginal cost curve has a U-shaped shape, but with tax in Australia, the marginal cost of Netflix consumption, this curve shift up.
2) With the release of a new electric vehicle, the demand for the bicycle market with batteries will decrease. Firstly, some will go to the electric car, which is more convenient than a lapel. And secondly, the possible increase in electricity prices will also negatively affect the demand for the bicycle market.