Final answer:
Flexible pricing can be controversial because it involves allowing prices to change based on supply and demand instead of being fixed. Proponents of flexible pricing argue that it allows markets to reach equilibrium and efficiently allocate resources. However, critics argue that it can lead to price instability and unfair pricing practices.
Step-by-step explanation:
Flexible pricing can be controversial because it involves allowing prices to change based on supply and demand instead of being fixed. Proponents of flexible pricing argue that it allows markets to reach equilibrium and efficiently allocate resources. However, critics argue that it can lead to price instability and unfair pricing practices.
An example of flexible pricing is tiered pricing for on-demand streaming services like Netflix, where different levels of access are offered at different prices. This allows consumers to choose the level of service that fits their needs and budget.
In conclusion, while flexible pricing can be controversial, it is a concept that is widely used in the economy and has both advantages and disadvantages.