2.) Recently, Netflix raised their price from $12 to $15. Their subscribers went from 100,000 in Palm Beach county to 75,000. Also, assume the elasticity of supply for Netflix is 1.2. a.) Using the midpoint formula, what was the elasticity of demand for Netflix?

b.) Knowing this elasticity of demand, how might the price increase affect total revenue?

c.) In the real world, what factors do you think influence the elasticity of demand for Netflix?

d.) Draw the approximate graph for this elasticity of demand and supply. If the government put a tax on streaming services, who would pay a larger burden of the tax? Why?