Platforms focus on achieving positive network effects and economy of scale.

Question

Quizplus · Accepted Answer

Platforms like social media, online marketplaces, and ride-sharing apps rely heavily on network effects, where the value of the platform increases as more users join and interact on it. This creates a positive feedback loop and incentivizes more people to join the platform. Achieving economies of scale is also important as it allows the platform to lower costs per user and increase profitability as the user base grows.

Platforms Focus on Achieving Positive Network Effects and Economy of Scale