Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Question
When the price that Netflix charges rises from $540 to $750 a month, the
quantity demanded decreases from 400 million to 250 million subscriptions.
Calculate the price elasticity of demand for Netflix charges. Is the demand
elastic or inelastic? Would the demand for Netflix be more elastic or less elastic
than the demand for overall streaming services? Why?
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