Some Economists Have Suggested That Network Externalities Result in Consumers

question 189

Multiple Choice

Some economists have suggested that network externalities result in consumers being locked into the use of products with inferior technologies.Economists Stan Leibowitz and Stephen Margolis have studied cases that have been cited as examples of this and found

• A)there is no convincing evidence that the alternative technologies were superior.
• B)consumers sometimes do become locked into the use of products with inferior technologies.
• C)that in all of these cases network externalities resulted in market failure.
• D)that consumers use products with inferior technologies when their prices are lower than products with superior technologies.

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Definitions:

Kidney

A pair of bean-shaped organs in the renal system that filter waste products from the blood and excrete them as urine.

Urinary System

The organs of the body involved in the production, storage, and excretion of urine.

Urine

A liquid waste product filtered from the blood by the kidneys, stored in the bladder, and expelled from the body through urination.

Ureters

Tubes that carry urine from the kidneys to the bladder, crucial for the urinary system.