Microeconomics 6th Edition by Robert Hall, Shirley Kuiper, Marc Lieberman

Exercise 16

In 2010,Apple wanted to lower the price of downloading TV shows from iTunes from $1.99 to $0.99. But Apple had to get permission from,and convince,the management of the networks with whom they share the revenue from each download. Apple argued that lowering the price would benefit both Apple and the networks. Managers at the networks disagreed,and wanted the price kept at $1.99.
a. What did Apple believe about the price elasticity of demand for downloaded shows?
b. What did the networks believe about the price elasticity of demand for downloaded shows?