In many large cities you can now use your cell phone to call Uber or Lyft instead of hailing a taxi. Would you expect this to affect the prices of taxi medallions (that is really the supply of taxis)? Why or why not? Talk about supply and demand curves in your answer. Make sure you can draw them!
As the demand for Uber increases so does the price. Uber is more accessible and easier to use so it creates a shift on the demand curve. Whereas the Taxi supply is decreasing making the prices increase by a lot. I know there are a few cities where this would not affect as much as in others, such as NYC because it is harder to get a license to have an Uber car. Since Uber is more convenient than Taxi, it makes the supply increase since there is more demand so the shift in demand curve will increase.
Can you think of an example where you watched the supply of a good or service change rapidly? (For example, a new hotel or restaurant opened.) Based on the chapter what would you expect to see happen? Why?
I can”t think of how rapidly the change was Red Box and Netflix coming in the market with a more convenient access to movies. Red Box offers the most recent movies, at a more cheaper price than buying or than renting them at Blockbuster. It may not be as convenient as Netflix but it is definitely a good deal and it has been in the market for quite some time. On the other hand, Netflix provides comfort and accessibility. It does not have the most recent movies but it offers other options, such as T.V shows, documentaries, among others. It is now available in different languages. These two are creating a knock-on effect on the rest of the broadcasting industry.
Give another example of a concept from this chapter. For example I used AirBnB to rent an apartment in San Francisco a few years ago. How did AirBnB affect the supply of short term room rentals in San Francisco? How about the supply of long term rentals?
One good example is renting books versus buying them. Buying books that you will only need for a semester sometimes can seem like a waste of money. Books are expensive and only neccessary for for two semesters at the most. Knetbooks among other companies such as Chegg, and Cengage give us the opportunity to rent used, or new books at a affordable price. Other companies such as Amazon only give you the option of buying. Amazon at the beginning only sold books, then, they started adding more to their inventory.
Netsy's Thoughts 