For network externalities to occur,
A)the government has to create new laws.
B)deadweight loss must be minimized.
C)there must be a critical mass of users.
D)there must be a positive benefit to society.

Question

Quizplus · Accepted Answer

Network externalities occur when the value of a product or service increases as more people use it. This means there must be a critical mass of users, or a large enough number of people using it to create a positive feedback loop. A and B are not necessarily related to the occurrence of network externalities, and D is a consequence of network externalities but not a requirement for them to occur.

For Network Externalities to Occur