Which of the following is an example of a good with positive network externalities?
A)A high-end car that has a long waiting list of prospective buyers
B)A shaving cream that is sold along with a pair of free razor blades.
C)An online messaging service that only allows registered users to use the service
D)An all-you-can-eat buffet at a restaurant
E)A movie screening that requires customers to buy tickets to watch the movie

Question

Quizplus · Accepted Answer

An online messaging service that only allows registered users to use the service is an example of a good with positive network externalities. As more users join the service, there are more people to message and interact with, making the service more valuable to each user. This creates a positive feedback loop where more users attract even more users, leading to a network effect. The value of the service increases for each user as the network grows.

Which of the Following Is an Example of a Good