The concept of 'Network Externalities' implies that: MCQ with Answer and Explanation

The concept of 'Network Externalities' implies that:
A. The value of a good or service increases with the number of other users
B. Externalities are always negative
C. The value of a good decreases with the number of users
D. Only production externalities matter
Answer: Option A
Solution (By JKSSB Mock Tests)
Network externalities exist when the utility that a user derives from a good or service depends positively on the number of other users of the same or compatible goods.

Discuss this Question (0)

No comments yet. Be the first to start the discussion!

Practice More Economy Set 1 Questions

Question #1
The 'Dunkel Draft' was associated with:
A. IMF reforms
B. human rights
C. climate change
D. GATT/WTO negotiations

Correct Answer: Option D


Explanation:
The Dunkel Draft was a proposal by Arthur Dunkel that formed the basis of the Uruguay Round agreement.

This question belongs to: Economy GK Economy Set 1
Question #2
The term 'Non-Performing Asset' in Indian banking is defined as a loan where:
A. Interest or principal is overdue for more than 90 days
B. The asset generates continuous income
C. The borrower has excess collateral
D. Interest is paid regularly

Correct Answer: Option A


Explanation:
As per RBI guidelines, a term loan is classified as NPA if interest or instalment of principal remains overdue for a period of more than 90 days.

This question belongs to: Economy GK Economy Set 1
Question #3
A 'customs union' differs from a free trade area by having:
A. separate external tariffs
B. free movement of labour
C. a common currency
D. a common external tariff

Correct Answer: Option D


Explanation:
A customs union has a common external tariff along with internal free trade.

This question belongs to: Economy GK Economy Set 1