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Netflix,an Online DVD Rental Service,engages in Price Discrimination by Separating

Question 63

Multiple Choice

Netflix,an online DVD rental service,engages in price discrimination by separating its customers into two groups: those who have a relatively elastic demand and those who have a relatively inelastic demand for DVD rentals.Those who have a relatively elastic demand are customers who


A) pay a monthly subscription fee; customers with a relatively inelastic demand pay for each DVD they rent.
B) pay for each DVD they rent; customers with a relatively inelastic demand pay a monthly subscription fee.
C) rent only a few DVDs per month; customers who rent many DVDs per month have a relatively inelastic demand.
D) rent many DVDs per month; customers who rent only a few DVDs per month have a relatively inelastic demand.

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