Exam 14: Network Goods

Versioning is a type of _____, which allows firms to _____.

Users of Linux and other forms of open-source software can form a type of _____ network.

Networks connected by groups of people using the same type or brand of good are known as _____ networks.

Attractive up-front deals used as an incentive to entice new customers into a network are

A vicious cycle occurs when a network good does not reach its tipping point.

The production of network goods is typically carried out in _____ increments, due to _____ fixed capital costs.

Network externalities are similar to positive externalities in that the person generating them does not directly benefit from them.

A network good is one where the _____ number of other users of the good.

A common format used by software and other products is known as network compatibility.

Network goods often foster a great deal of competition because firms wish to ensure that products can be used on different platforms.

Lock-in strategies are used after a customer adopts a product.

Which network is a combination of two other types of networks?

(Figure: Externalities and Network Effects) Based on the graph, we see that if a consumer leaves the social network depicted

(Figure: Understanding Network Good Markets) The graph depicts the market for a network good. Which letter represents the private demand curve?

Telecommunications customers are often given discounts for purchasing home telephone service, Internet connectivity, and cell-phone service simultaneously. This is BEST described as an example of

(Figure: Market for a Network Good 2) The graph depicts the market for a network good. What point represents equilibrium after a virtuous cycle takes hold?

When a consumer joins a network, the private demand curve _____ and the social demand curve _____.

Bundling allows a firm to capture customers of related products by making it more attractive to use that firm's products.

The network effect on demand becomes larger as more people join the network.

(Figure: Market Equilibrium for a Network Good) Based on the graph, equilibrium occurs at point