Technology & the Digital Economy: Checkpoint 1

Covers network effects, the economics of free platforms, winner-take-most markets, and data as an economic asset.

Five questions on the first four lessons: network effects, why “free” platforms make money, winner-take-most markets, and data as an economic asset.

Question 1 of 5 What is a network effect?

A discount given to loyal customers A product becoming more valuable as more people use it A fee charged for using a platform A type of computer network security

Question 2 of 5 In the ad-supported 'free' model, who are the platform's actual paying customers?

The users of the app The government Advertisers App store operators

Users get the product for free while advertisers pay for access to those users' attention and data - a two-sided market.

Question 3 of 5 Which of these factors pushes tech markets toward winner-take-most outcomes?

High switching costs between platforms Government price controls Mandatory licensing fees Seasonal demand changes

Question 4 of 5 Why does data function as a genuine economic asset?

It physically depreciates like machinery It can be used repeatedly to generate future value without being used up It must be stored in a bank It only has value for one company at a time

Unlike physical goods, data isn't consumed by use - the same dataset can be analyzed repeatedly to keep generating value.

Question 5 of 5 What is a 'data network effect'?

A rule requiring companies to delete old data More users generating more data, which improves the product and attracts even more users A law limiting how much data a company can collect A network effect that only applies to social media

← Back to Data as an Economic Asset Next lesson → Platform Monopolies and Antitrust

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