As Customers Switch from Renting DVDs to Downloading or Streaming

question 75

Multiple Choice

As customers switch from renting DVDs to downloading or streaming movies from the Internet,Netflix will likely find it ________ to remain profitable as they face ________ competition with streaming movies than with mail order DVD rental.

• A) harder; more
• B) harder; less
• C) easier; more
• D) easier; less

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Definitions:

Prime Costs

These are the direct costs of manufacturing a product, including direct materials and direct labor.

Baker's Salaries

Compensation provided to bakers, who are skilled individuals responsible for baking bread, pastries, and other confectioneries.

Indirect Materials

Materials used in the production process that are not directly traceable to the finished product, such as lubricants for machinery.

Fixed Period Cost

Describes expenses that do not fluctuate with the level of production or sales within a certain time frame, such as rent and salaries.