A network externality is:
A)the effect that an additional user of a good or participant in an activity has on the value of that good or activity for others.
B)directly on an economic decision maker.
C)indirectly on an economic decision maker.
D)without compensation on someone other than the person who caused it.

Question

Quizplus · Accepted Answer

A network externality is the positive effect that an additional user of a good or participant in an activity has on the value of that good or activity for others. This effect can be direct or indirect and can create a positive feedback loop where the more people use a good or participate in an activity, the more valuable it becomes for everyone involved.

A Network Externality Is