Christmas with the Kranks — Christmas Tree Demand

The Kranks are (initially) planning to skip Christmas this year, which means their demand for Christmas trees decreases. When their daughter announces that she’ll be back home for Christmas, the Kranks scramble to try and find a tree. Unfortunately for Luther, there aren’t many trees available because it’s so close to the holidays and he ends up paying full price (instead of a discounted price) for a pathetic tree. When decision-makers don’t have much time to make a purchase (like Luther right before Christmas), their demand is fairly inelastic.

Thanks to Mandy Mandzik for the clip recommendation. Check out her working paper, All I Want for Christmas is an A on My Econ Final: A Holiday-Themed Review Class, for more Christmas-themed economics examples.

Christmas with the Kranks — Skipping Christmas

With their daughter heading out of town, the Krank family decides to skip Christmas and head on vacation. An opportunity cost is the value of the next best alternative. While their daughter was still at home, the Krank family preferred spending it with their family and celebrating Christmas. After their daughter announces she’ll leave, the Krank family decides to head to the Caribbean.

Thanks to Mandy Mandzik for the clip recommendation. Check out her working paper, All I Want for Christmas is an A on My Econ Final: A Holiday-Themed Review Class, for more Christmas-themed economics examples.

Christmas with the Kranks — Hickory Honey Ham

This scene is from the movie Christmas with the Kranks involves a specific type of ham that has been sold out and Mrs. Krank needs one because it’s Christmas Eve and her daughter flew in for Christmas.  She pays above the sticker price of the ham because it was the last one available in the store. Because there is only one ham left and it doesn’t matter how much the ham costs, Mrs. Krank will buy it.  This means that Mrs. Krank’s elasticity for hickory honey ham is very inelastic.

Thanks to Salvatore Pollastro for the summary and the clip!

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