Author Question: With y measured on the vertical axis and x measured on the horizontal axis, the slope of a straight ... (Read 257 times)

javeds · **on:** Jun 29, 2018

With y measured on the vertical axis and x measured on the horizontal axis, the slope of a straight line is defined as

A) y/x.
B) x/y.
C) (change in y)/ (change in x).
D) (change in x)/ (change in y).

Question 2

John is a user of WhatsApp Messenger. When he initially started using it, the messenger was not very popular among his friends and John did not spend much time on it.

As more and more of John's friends started using the messenger, the messenger's value to John increased substantially. What kind of externality is reflected in this example?

janeli · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

C

Answer to Question 2

This is an example of a network externality. A network externality occurs when a product's value increases as more consumers begin to use it. As more of John's friends started using the messenger, his value for the messenger increased as he could now communicate with more people using the messenger.