Which Statement Describes the Tipping Point in the Market for a Network

question 240

Multiple Choice

Which statement describes the tipping point in the market for a network good?

• A) The firm can no longer raise prices while gaining customers but must lower prices to gain customers.
• B) The firm has reached minimum ATC and will face rising ATC if it increases output.
• C) The firm has a sufficient number of customers for network effects to support the network.
• D) The firm is entering a vicious cycle.

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