How does a positive network effect influence the private and social demand curves for a network good?
A) Private demand shifts left, and social demand shifts right.
B) Private demand shifts right, and social demand shifts left.
C) Both private demand and social demand shift left.
D) Both private demand and social demand shift right.

Question

Quizplus · Accepted Answer

A positive network effect means that the value of a good or service increases as more people use it. This increases both the private and social demand for the good, shifting both demand curves to the right.

How Does a Positive Network Effect Influence the Private and Social