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Why Does Network Externality Arise

Question 59

Multiple Choice

Why does network externality arise?


A) Each additional unit of a good sold reduces the value of the previously sold units.
B) As more and more units of a good are produced,the average cost declines.
C) Consumption of a good by one user does not affect the consumption of subsequent users.
D) The firms enjoy economies of scale in the long run.
E) Each additional unit of the good sold increases the value of the previously sold units.

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