When customers face significant ________ costs,the demand for the existing product becomes more inelastic.
A) network
B) bandwagon
C) switching
D) staying
E) marginal

Question

Quizplus · Accepted Answer

Switching costs refer to the costs that customers incur when changing from one product or service to another. These costs could be monetary (e.g. termination fees, installation fees) or non-monetary (e.g. time spent learning a new product). When switching costs are high, customers are less likely to switch to a different product, and therefore the demand for the existing product becomes more inelastic.

When Customers Face Significant ________ Costs,the Demand for the Existing