When the Market for a Network Good Is Contestable

question 42

Multiple Choice

When the market for a network good is contestable,:

• A) there is little competition.
• B) many firms operate and compete for consumers in the industry.
• C) it is hard for consumers to get locked into a "bad" outcome.
• D) monopoly firms always charge prices well above their average costs.

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Definitions:

Impulse Buying

An unplanned decision to buy a product or service, made just before a purchase.

Behavioral Economics

The study of how psychological, social, cognitive, and emotional factors affect economic decisions and the implications for market prices, returns, and resource allocation.

Retail Stores

Physical or online outlets that sell goods directly to consumers for personal or household consumption.

Behavioral Economist

An economist who studies the effects of psychological, cognitive, emotional, cultural, and social factors on the economic decisions of individuals and institutions.