no.1.2 and 1.3 (15 Marks) 1.2 Network externality is an economics term that describes how the
demand for a product is dependent on the demand of others buying that product. In other words,
the buying patterns of consumers are influenced by others purchasing a product. With the aid of
diagram/s distinguish between positive and negative network externality and give a real-life
example of each. (15 Marks) 1.3 A price change is known to cause both income and substitution
effect. Suppose you are given equation Px X+PyY= 1. If we assume that good X is a normal
good and its price decreases while good Y and I remains constant. Carefully choose a diagram
and explain the income and substitution effect. (20 Marks) The end 3 | Page.
MULTIDISCIPLINRY NATURE OF THE ENVIRONMENTAL STUDIES.pptx
no.1.2 and 1.3 (15 Marks) 1.2 Network externality is an economics .pdf
1. no.1.2 and 1.3 (15 Marks) 1.2 Network externality is an economics term that describes how the
demand for a product is dependent on the demand of others buying that product. In other words,
the buying patterns of consumers are influenced by others purchasing a product. With the aid of
diagram/s distinguish between positive and negative network externality and give a real-life
example of each. (15 Marks) 1.3 A price change is known to cause both income and substitution
effect. Suppose you are given equation Px X+PyY= 1. If we assume that good X is a normal
good and its price decreases while good Y and I remains constant. Carefully choose a diagram
and explain the income and substitution effect. (20 Marks) The end 3 | Page
