"Network externalities" refer to:
A)The benefits that firms derive from using social networks (such as Facebook and Google+)in their marketing
B)The value that the user of a product derives from the number of other users of the same product
C)The costs and benefits that are borne by or received by society as a result of the actions of a business enterprise
D)The consequences of platform-based competition

Question

Quizplus · Accepted Answer

Network externalities refer to the value or benefit that a user of a product derives from the number of other users of the same product. They can be positive (increased value with more users) or negative (decreased value with more users). Examples include social networks, where the value for each user increases as more people join the network, or video conferencing software, where the value depends on how many other people can be reached through the same platform.

"Network Externalities" Refer To