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For a Good with Network Externalities, Draw a Diagram Showing

question 12

Essay

For a good with network externalities, draw a diagram showing the relation between the number of units sold and the willingness to pay of demanders.Find a price at which there are two stable and one unstable equilibrium quantities.Label these equilibria and explain why the unstable equilibrium is unstable.


Definitions:

Conductors

Materials or substances that permit the flow of electric charge with minimal resistance.

Network Port

A port that connects a computer to a wired network.

Ethernet

A network system that carries computer data along with audio and video information, with Ethernet adapters being the most common network cards.

Wireless Technologies

A broad range of communication technologies that transmit data over the air without requiring physical connectors or cables, including Wi-Fi, Bluetooth, and cellular networks.

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