Future Electronics Inc.'s body scanning machine has been adopted by majority of the healthcare market. As a result, the company demands a high price from its customers, which mainly include hospitals. It is not investing much on innovation and its product variety is also very low. This cost borne by the users in this case is referred to as:

(A) Marginal cost

(B) Social cost

(C) Monopoly cost

(D) deferred cost

Question

Elliot Matthews

Social Studies

24 August, 08:12

Future Electronics Inc.'s body scanning machine has been adopted by majority of the healthcare market. As a result, the company demands a high price from its customers, which mainly include hospitals. It is not investing much on innovation and its product variety is also very low. This cost borne by the users in this case is referred to as:

(A) Marginal cost

(B) Social cost

(C) Monopoly cost

(D) deferred cost

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Answers (1)

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Sexton · Answer 1

C) Monopoly cost

Explanation:

This cost borne by the users, in this case, is referred to as monopoly cost. Monopoly means that there is only one provider of a service in one specific market. Therefore, the cost is determined by Future Electronics Inc. As this seller controls the market they can choose the price they ask from their customers.