100 Economics Question of the Day: An Intermittent Blog: What they lose in price they make up in volume

Thursday, November 17, 2005

What they lose in price they make up in volume

For those wondering about the value of "social cost," here is a clear example. Compare the second paragraph:
[S]everal companies and organizations were unveiling their plans to bring the world closer and, in a sense, narrow the digital divide, by providing laptops that cost just US$100 (euro85)

and its later elaboration
Late Wednesday, a text-book sized laptop boasting wireless network access and a hand-crank to provide electricity was unveiled by Nicholas Negroponte, Chairman of MIT Media Lab.

The machines will sell for $100, making them accessible to millions of school-aged children worldwide, he said.

[Nicholas] Negroponte said he expects 1 million of them to be sold to those countries. He did not say who would build the machine, which will cost $110 to make, but at least five are considering bids to do so.[emphasis mine]


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