MGT 420 Quiz 2 with verified answers
graded A+ passed
Network externalities - correct answer ✔✔Also termed positive consumption externalities, this
is when the value of a good to a user increases with the number of other users of the same or
similar good.
Installed base - correct answer ✔✔The number of users of a particular good.
Path dependency - correct answer ✔✔When end results depend greatly on the events that took
place leading up to the outcome. It is often impossible to reproduce the results that occur in
such a situation.
Increasing returns - correct answer ✔✔When the rate of return from a product or process
increases with the size of its installed base
First movers - correct answer ✔✔The first entrants to sell in a new product or service category
Early followers - correct answer ✔✔Entrants that are early to market, but not first
Late entrants - correct answer ✔✔Entrants that do not enter the market until the time the
product begins to penetrate the mass market or later
Monopoly Rents - correct answer ✔✔The additional returns a firm can make from being a
monopolist, such as the ability to set high prices, or the ability to lower costs through greater
bargaining power over suppliers
graded A+ passed
Network externalities - correct answer ✔✔Also termed positive consumption externalities, this
is when the value of a good to a user increases with the number of other users of the same or
similar good.
Installed base - correct answer ✔✔The number of users of a particular good.
Path dependency - correct answer ✔✔When end results depend greatly on the events that took
place leading up to the outcome. It is often impossible to reproduce the results that occur in
such a situation.
Increasing returns - correct answer ✔✔When the rate of return from a product or process
increases with the size of its installed base
First movers - correct answer ✔✔The first entrants to sell in a new product or service category
Early followers - correct answer ✔✔Entrants that are early to market, but not first
Late entrants - correct answer ✔✔Entrants that do not enter the market until the time the
product begins to penetrate the mass market or later
Monopoly Rents - correct answer ✔✔The additional returns a firm can make from being a
monopolist, such as the ability to set high prices, or the ability to lower costs through greater
bargaining power over suppliers
