Categories
Consumer Choice & Behavioral Supply & Demand

Discounted Beer

Store brand beef products are being marked down 80% and Garret suggests that customers should consider why a store would do something like that. He’s suggesting something may be wrong with the product, and perhaps the store knows more about the quality of the meat than the customers do.

Categories
Consumer Choice & Behavioral Principles Supply & Demand

Consumption vs. Savings

Bo and Cheyenne are shopping for wedding supplies in the store. Bo really wants to buy some laptops so they can smash them during the wedding as a form of entertainment. Amy is shocked because she knows how expensive it is to raise a child and believes that the couple should be saving the money instead of spending it on one day. Amy tricks Bo into playing a game with a price gun so that Bo and Cheyenne can see how expensive a child can be. People struggle to recognize the opportunity costs in their decisions, but Amy has made the cost more salient.

Categories
Supply & Demand

Wedding Sale Rush

The store is having a one-day wedding sale and the discounts are steep enough that there is a line of women ready to purchase products. The increased purchases represent a change in the quantity demanded for items from the store. Since they didn’t stock enough items, the low prices will result in a shortage and likely an inefficient allocation among the shoppers.

Categories
Market Structures Supply & Demand

Wedding Premium

Garret notices that the store sells two dresses that look identical, but one is marketed as a white dress and the other is a white wedding dress. The wedding dress costs $200, but the other dress only costs $30. The wedding industry is notorious for high markups on products that are labeled for weddings because brides and grooms often have fairly inelastic demand for their products. Because of this inelastic demand, firms are able to price discriminate and charge higher prices.

Categories
Supply & Demand

Unnecessary Bean Hopper

In order to win the Color Wars, teams have to sell as much as they can. Jonah doesn’t feel comfortable with the premise of this competition, even when the customers explicitly state that money isn’t a consideration in their purchase decisions. The coffee maker with the built-in bean hopper isn’t really necessary (which Jonah points out), but the customer is displaying some conspicuous consumption behavior.

Categories
Supply & Demand

Talked Into Buying a Grill

Jonah convinces Adam (Amy’s husband) to buy a new grill even though the couple doesn’t really need it. Earlier in the episode, Amy convinced Jonah to start selling stuff to people even if they don’t need it so they can win the store’s Color Wars. Adam and Amy don’t really have the savings to afford such a lavish purchase, but Jonah emphasizes how great the grill would be for Adam’s YouTube channel.

Categories
Supply & Demand

Get the Better Bike

Garret is in the process of convincing a customer to purchase a more expensive bike, the Vilano Forza, but the customer wants the cheaper RX-5 bike. Price isn’t the only determinant of a consumer’s utility function and Garret tries to convince the customer that the other features of the bike are worth the price. To end the scene, Garret also tries to get the customer to buy a bicycle helmet, which is a good example of a complementary good.

Categories
Labor Supply & Demand

Handheld Automation

Corporate has created new devices for customers to use that will allow them to look up where items are located in the store, scan the items, and pay for their total. The employees quickly point out that the device essentially replaces the workers and they are left wondering what that means for them. Dina tries to point out the relationship between ATMs and bank tellers, although she doesn’t have it exactly right.

At the end of the clip, Amy points out that corporate has also asked the stores to cut back employee hours, which implies that the new machines are replacing some of the labor in the store.

Categories
Growth Labor Supply & Demand

Cell Phones: Innovative or Destructive?

It’s back to school time and everyone has flooded the store to buy calculators, notebooks, dictionaries, and planners, but these are all items that come with a smartphone so it makes those products obsolete for most individuals. Joseph Schumpeter was a popular economic philosopher who pioneered the theory of creative destruction, which occurs when new innovations replace old industries. The benefits are a higher standard of living, but at the cost of jobs in those old industries.

Categories
Supply & Demand

Lottery Debate

Mateo and Cheyenne discuss what they would do if they won the lottery. The two list a variety of different items they would spend their money on after receiving their income boost. This income adjustment would result in the two of them purchasing normal goods, specifically luxury goods. These purchases are driven by income changes, not by the price of those products.