Question
Read the passage below and determine which of the
following statements can be correctly inferred from the text. Passage: Netflix revolutionized the entertainment industry by transitioning from a DVD-by-mail service to a global streaming giant, introducing binge-watching culture and original content production. Its aggressive expansion forced traditional cable providers to pivot their business models and paved the way for competitors like Disney+ and Amazon Prime Video. However, as it expanded, Netflix faced mounting debt to fund its original programming and criticism over its password-sharing crackdowns and rising subscription costs. While Netflix remains a market leader, the increasing cost of content acquisition and intensifying competition have made its long-term dominance a subject of debate among analysts. Statements: I. Netflix’s shift to streaming fundamentally altered consumer habits and the competitive landscape of the media industry. II. Netflix encountered operational and reputational hurdles as a result of its growth strategies and policy changes. III. Netflix’s lead in the market is guaranteed to continue indefinitely due to its early entry into the streaming space.Solution
Statement I (True): This mirrors your "fundamental change in booking/paying" logic. The passage states that Netflix "revolutionized the entertainment industry" and "introduced binge-watching culture," while forcing competitors to "pivot their business models." This confirms a fundamental shift in both consumer habits and the industry landscape. Statement II (True): This mirrors your "legal and ethical challenges" logic. The passage mentions "mounting debt," criticism over "password-sharing crackdowns," and "rising subscription costs." These represent financial (operational) and public perception (reputational) hurdles resulting from their growth and policy choices. Statement III (False): This mirrors your "profitability is assured" logic. The passage explicitly states that its "long-term dominance is a subject of debate among analysts" due to competition and costs. Therefore, claiming its dominance is "guaranteed" contradicts the text.
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