Saturday, November 17, 2007

Unit 1: Disequilibrium and Substitutes in the games console market

This year's must-have Christmas gift, the Nintendo Wii console, is in short supply across the UK according to this BBC clip and associated article
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a) Using economic language, how would you describe the supply of the Nintendo Wii?
b) Using a diagram, explain how the market for the Wii is in a disequilibrium
c) What has begun to happen to restore equilibrium in the market?

The likely winner resulting from this shortage is Sony according to this BBC article

d) Why have Sony sales increased?
e) Using your knowldge of the video games market, dicuss the extent to which the Wii, PS3 and Xbox 360 are substitute products

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