Question:

Economic principle (related to unlimited supply)?

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I'm looking for the economic principle to explain situations where there is an high upfront cost that relates in a virtually unlimited supply. Example of this include online training courses and satellite networks.

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  1. Chances are the issue isn't about the supply, but about competition..  The startup cost for an online training course is low. As such, competition and customer retention is cutthroat. If you pay a high up front cost, its most likely because (a) you are pre-paying to make sure you remain a customer for a certain period of time and (b) to provide incentive to remain a customer or risk losing your up front payment.


  2. My guess is economies of scale.

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