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Result of the price increases

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Netflix recently raised the price for its standard service from $10 to $11, an increase of 10%. It also increased the price of its prime service from $12 to $14, an increase of 17%. However, the first law of demand kicked in and as a result the total number of subscribers dropped; as a result, total revenue only increasing by 4%. TFU and explain: It is unclear based on the information given above whether profits at Netflix increased or decreased as a result of the price increases.

Reference no: EM132542183

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