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Consider the market for CD players, illustrated in the figure to the right. Suppose there are network externalities in this market such that the quantity

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Consider the market for CD players, illustrated in the figure to the right. Suppose there are network externalities in this market such that the quantity 200- of a good demanded grows in response to the growth of purchases by other 180- Doo P150 individuals (as indicated by the demand curve "Demand" in the figure). Suppose that the price is initially $70 where the quantity demanded is 150 160- Demand (thousand CD players per month). 140- If the price of CD players falls to $50, demand will increase to 180 120- thousand CD players per month. (Enter your response using an integer.) Price 100- Of this increase, thousand units of the 30 thousand-unit increase is the 80 - pure price effect and thousand units of the increase is the bandwagon effect. 60- 40- 20 - D60 20 40 60 80 100 120 140 160 180 200 220 CD Players (thousands per month)

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