Which of the following is true of dominant design?

Question

Quizplus · Accepted Answer

When a dominant design emerges in a market, a firm that is unable to adopt it may find itself locked out of the market. This is because customers and other firms in the market may demand compatibility with the dominant design, making it difficult or impossible for non-compliant firms to compete. A legally induced adherence to a dominant design is possible through industry standards and regulations, so option A is incorrect. Option B is also incorrect because firms that establish dominant designs typically earn high rewards due to their market power. Option C is incorrect because firms that support a dominant design are often in a strong position to shape the evolution of the industry.

Which of the Following Is True of Dominant Design