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When a TV company chooses a pay-per-view scheme to pay for programming, which of the following is true, false or uncertain? Explain carefully in each case. Most of the marks will be awarded for the clarity of your explanation.

a) The outcome is socially efficient.

b) The marginal cost to an additional viewer of watching the programs is lower than when advertising is used to finance programming.

c) The outcome is more socially efficient than when advertising is used to finance programming.

d) The variety of programs is likely to increase.



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