Russ Roberts spins a tale of a local bread market and wonders about the power of such a market. He hypothesizes the trouble that could occur if one person were given supreme power and became a bread czar. You can read the poem online as well, with commentary!
Beau thinks prices are low and waits for something to happen. Luckily the prices change when supply and demand changes for substitute goods!
Thanks to James Tierney for the clip and description.
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!
Guest co-host, Ashanti, mentions that expensive flights during Thanksgiving should be “tapped out” because a lot of people need to be with their families during Thanksgiving. This relates to the concept of demand and supply because the airlines know that when it is close to Thanksgiving, the demand for flights increases, and since most people are eager to be with their families, they are rather inelastic to the price change, so the firms take advantage of this and raise the price of the tickets drastically in order to increase their total revenue.
Thanks for the clip and summary Tammy Georgewill!
It’s time to short sell the orange juice commodities in Trading Places. Billy and Louis wait for the right price to sell and then hear from the Secretary of Agriculture that the market for oranges won’t be as bad as anticipated so then turn around to buy cheap.
Billy, played by Eddie Murphy in Trading Places, works through the process of why pork belly prices are declining during the Christmas season.
Jason Bourne, played by Matt Damon, asks a cash-strapped young woman (Franka Potente) for a lift while Conklin (Chris Cooper) musters all of his forces to find him. Both parties have something that the other one needs, so a mutually beneficial trade occurs. This clip really highlights the concept of double coincidence of wants.
Watch a market in action during the Aalsmeer, Netherlands flower auction.
Forrest easily enters the shrimp market by buying a boat. There are multiple buyers and sellers, and no one shrimping boat controls the price of shrimp. Therefore the shrimp market is an example of perfect competition. Once the hurricane hits it forces all the other boats to exit the market. Turning the market into a monopoly. Forrest is the sole supplier of the product, controlling the entire market, turning it into a monopoly.
Thanks for the clip and summary Keagan Rallis