Why have digital goods become so dominant? Think for example the music industry. a) There are clear direct network effects as a result of digitalization. b) Digital goods are non-rival. c) Some costs are lower for digital goods than for traditional goods.

Why have digital goods become so dominant? Think for example the music industry. a) There are clear direct network effects as a result of digitalization. b) Digital goods are non-rival. c) Some costs are lower for digital goods than for traditional goods.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter12: More Realistic And Complex Pricing

Section: Chapter Questions

Problem 12.4IP

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Question

A3 True/false

Why have digital goods become so dominant? Think for example the music industry.
a) There are clear direct network effects as a result of digitalization.
b) Digital goods are non-rival.
c) Some costs are lower for digital goods than for traditional goods.
d) Digital goods are sold at almost zero prices.

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