Which of the Following Conditions Is Required for a Networkgood

question 29

Multiple Choice

Which of the following conditions is required for a networkgood to succeed over a better good in the market?

• A)The network good should have a minimal number of consumers so that customers are not competing for the same
• Network.
• B)The network good should have a much larger number of consumers or users than the better good.(True Answer
• )Correct
• C)The network good should be a free good.
• D)All of these conditions are required.

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Definitions:

Cost Analysis

The process of assessing the costs involved in carrying out a particular business activity or project.

Variable Expenses

Costs that vary in direct proportion to changes in the level of activity or volume of production.

Fixed Expenses

Obligations that remain constant in total regardless of changes in business activity levels, such as lease payments and salaries.

Cost Formula Equation

An equation that determines the total cost based on fixed costs, variable rate per unit of activity, and the level of activity.