Network externalities exist when the value of a product to an individual depends on the number of other users.

Question

Quizplus · Accepted Answer

Network externalities, also known as network effects, arise when the value of a product or service increases as more people use it. This can be seen in social networks, online marketplaces, and other platforms where the more users there are, the more valuable the platform becomes for each individual user.

Network Externalities Exist When the Value of a Product to an Individual