A network externality exists
a. in the television industry
b. outside the television industry
c. whenever an increase in the size of a network increases its value to current and potential members
d. whenever an increase in the size of a network increases its average total cost of production
e. whenever an increase in the size of a network increases its total cost of production
C
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Marginal physical product measures the increase in total output that results from a one-unit increase in an input
a. True b. False Indicate whether the statement is true or false
The law of demand is based on the observation that
A. people always want more than they need. B. people are indifferent to price changes. C. people buy more of a product when its price falls. D. people buy less of a product when the product becomes less fashionable.