Winner-take-all industries,where the leading firm accounts for the great majority of the industry's total profit,are usually the result of:
A)Economies of scale
B)Economies of scope
C)Network externalities
D)Product differentiation

Question

Quizplus · Accepted Answer

Network externalities occur when the value or utility of a product or service increases with its adoption or use. In winner-take-all industries, the leading firm benefits from network externalities as more customers adopt its product or service, making it more valuable to future customers. As a result, the leading firm captures most of the industry's total profit.

Winner-Take-All Industries,where the Leading Firm Accounts for the Great Majority