Netflix Incurs a Huge Fixed Cost to Obtain Streaming Rights

question 61

Multiple Choice

Netflix incurs a huge fixed cost to obtain streaming rights to movies and television programs.However,it is able to spread this cost over a large number of subscribers that results in a cost-savings phenomenon referred to as

• A)volume synergies.
• B)economies of scale.
• C)captured savings.
• D)size effects.
• E)location economies.

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Definitions:

Second Bank

The Second Bank of the United States, established in 1816 and operational until 1836, was a central bank chartered by the U.S. government to manage the country's finances.

U.S.

A country in North America, officially known as the United States of America, characterized by a federal republic governance structure and a diverse population.

Internal Improvements

Historical term referring to public works projects in the United States, such as roads, canals, and railroads, aimed at developing the nation's infrastructure.

Clinton's Big Ditch

A colloquial term for the Erie Canal, significantly funded and championed by New York Governor DeWitt Clinton in the early 19th century, enhancing trade and westward expansion.