A Significant Downside to Network Externalities Is That

question 56

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 hiring celebrity endorsements may be very high.
• D) there may be large switching costs to firms changing technologies.

---

Definitions:

Negative

A term that describes a value less than zero, indicating direction, charge, or a decrease in a measurable quantity.

Central Location

A statistical term that refers to the center or typical value in a set of data, often measured by mean, median, or mode.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values; how spread out numbers are around the mean.

Median

The middle value of a data set, which divides the set into two equal halves when arranged in ascending or descending order.