The market for social-networking website services is characterized by network externalities because
A) the less other people are using the website,the more any one person enjoys it.
B) the number of other people using the website has no effect on any one person's enjoyment of it.
C) the more other people are using the website,the more any one person enjoys it.
D) a person needs a computer network to access a social-networking website.
E) people are less likely to be hired by an employer if they use social-networking websites.

Question

Quizplus · Accepted Answer

Network externalities refer to the idea that the value of a product or service increases as more people use it. In the case of social-networking websites, the more people who use the website, the more valuable it becomes to each individual user because there are more people to connect with, share content with, and interact with. Therefore, choice C is the best answer. The other choices are incorrect because they do not accurately describe network externalities in the context of social-networking websites.

The Market for Social-Networking Website Services Is Characterized by Network