A Significant Downside to Network Externalities Is That

question 131

Multiple Choice

A significant downside to network externalities is that

• A)there may be large switching costs to consumers of changing products so that consumers end up using products with inferior technologies.
• B)firms may network with unethical suppliers or distributors.
• C)the costs of using celebrity endorsements may be very high.
• D)there may be large switching costs to firms changing technologies.

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Definitions:

Manufacturers' Representatives

Individuals or businesses that sell manufacturers' products to wholesalers and retailers without taking ownership of the goods, operating on a commission basis.

Sales Administration

The process of overseeing and managing a company's sales operations, including planning, reporting, and goal setting.

Ethics

The branch of philosophy that deals with questions about morality, including the analysis of concepts like right and wrong, virtue and vice, and justice.

Pricing Strategies

Methods businesses use to set the selling price for their products or services, based on factors like cost of production, market demand, competition, and customer value perception.