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Which Statement Describes the Tipping Point in the Market for a Network

Question 240

Multiple Choice

Which statement describes the tipping point in the market for a network good?


A) The firm can no longer raise prices while gaining customers but must lower prices to gain customers.
B) The firm has reached minimum ATC and will face rising ATC if it increases output.
C) The firm has a sufficient number of customers for network effects to support the network.
D) The firm is entering a vicious cycle.

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