Question

1. For each of the following product markets, do you think network effects are present? (remember to consider the role of complimentary products)
   1. Online payment services like Venmo or Paypal
   2. Electric cars like Tesla
   3. Self-driving cars

Answer 1

a) yes, for online payment system like Venom and Paypal network effect are present as more and more people are using it the benefit for everyone will increase. Like there are 10 people on paypal that service will be almost useless but if there are 10 million. It will be a seamless money transfer network and all can benefit from it.

b) Yes, for electric cars like tesla network effect is present. As more and more people are using it, it will increase the services available for all the cars like frequent charging points, repair and other services. All this will be available if there is only one such company or car.  

c) Self Driving car doesn;t have subs network affect. Its similar to driving other cars. this is just self driven.