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.

Understand the treatment of pre-acquisition revenues and expenses in consolidated financial statements.

Account for investment adjustments when a portion of an investment in a subsidiary is sold.

Prepare a fair-value allocation and amortization schedule, including goodwill.

Understand the concept of control and its implications on consolidation.

---

Definitions:

North American Colonies

The North American Colonies refer to the territories in North America that were colonized by European powers from the 16th century, leading to the formation of countries like the United States and Canada.

Native Americans

Refers to the indigenous peoples of the Americas, present before the arrival of European explorers and settlers.

Pontiac's Uprising

A rebellion led by the Ottawa leader Pontiac in 1763, uniting Native American tribes against British post-colonial policies in the Great Lakes region.

Ohio Country

A term used in the 18th century for the territory west of the Appalachian Mountains, contested by French, British, and various Native American tribes before becoming part of the United States.