Network externalities:
A)can explain why more efficient technologies displace less efficient technologies.
B)can explain why the economy fails to adopt the most efficient technologies.
C)reduce the cost of switching to new technologies without network externalities.
D)can explain why technological lock-in no longer occurs.

Question

Quizplus · Accepted Answer

Network externalities can lead to situations where the economy fails to adopt the most efficient technologies because the value of a product or service increases as more people use it, potentially causing less efficient technologies to become entrenched if they achieve an early lead in adoption.

Network Externalities