Many Economists Do Not Believe That Network Externalities Lock Consumers

question 117

Multiple Choice

Many economists do not believe that network externalities lock consumers into the use of products that have technology inferior to other, similar products.These economists believe that

• A)consumers are always rational.
• B)in practice, the gains from using a superior technology exceed the losses consumers incur from switching costs.
• C)there is no good evidence that switching costs exist.
• D)the government will prevent products with inferior technology from being sold to consumers.

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Definitions:

Flexibility

The ability of an organization or individual to adapt to changes and new demands in their environment effectively.

Planning

The process of outlining a sequence of actions to achieve specific goals or objectives.

Analyzing Action Alternatives

The process of assessing different possible actions to determine which would be most effective in achieving desired objectives.

Implementing

The process of putting plans, strategies, or ideas into action to achieve desired outcomes.