Some have argued that the music industry is by nature inefficient because once a piece of music is produced, the firm that owns it has a monopoly and charges the monopoly price. Yet, the marginal cost of making the music available to one more member of the public (via the Internet) is zero. Draw a diagram, similar to Figure, to represent this situation. Identify on your diagram:
a. The efficient level of production
b. The level of production a government-regulated music industry would earn if it were permitted to charge just enough for a €œfair rate of return€
c. The level of production provided by the (currently unregulated)industry

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At pointA all resources are used for wheat Bushels of Wheat per Year Moving from point A to point B requires shifting resources out of wheat and into tanks 1,000,000 950,000 850,000T-- At point F all resources Eare used for 400,000 -anks Number of 1,000 2,000 3,000 4,000 5,000 Tanks per Year