Network Externalities Exist When

question 21

Multiple Choice

Network externalities exist when:

• A) set-up costs of production are high, keeping competitors out of the market.
• B) the first firm to enter the market takes the greatest risk of failure.
• C) marginal costs decline as production levels rise.
• D) the greater use of a product increases the benefit of that product to everyone.

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Definitions:

Separation Anxiety

A psychological condition where an individual experiences excessive fear or anxiety when separated from home or loved ones.

Emotionally Expressive

The capacity or tendency to convey feelings or emotions openly or outwardly.

Infant Sons

Young male children in the earliest period of life, typically from birth to one year.

Infant Daughters

Young female children in the initial stage of life, typically considered to be under the age of one.