Chapter 4 - Reflections

Topic: Supply and Demand

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.

I think that this app has and will continue to effect the prices of the taxi medallion. From an article I read online a medallion owner stated that the price does continue to go down but that the demand for a cab has stayed steady. He also stated that the revenue flow is continuing to go down with the medallion. 

The demand for the medallion will begin to go down because there will be continued loss in revenues as the Uber or Lyft app continue to rise in popularity. They supply of medallions will go down as an effect of the lowered demand. 

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?

A new restaurant opened in Eagle two years ago in a busy, popular area on Broadway. When the restaurant opened it was very busy because they were providing a new dining experience in town. The demand for the new restaurant was high and the supply of consumers was high. The prices of their entrees was high. But as the year continued the customers had continued lack of service and poor quality of food. The restaurant demand was continuing to decline as the customers slowly stopped returning to dine. Customers found other areas to dine that were less expensive and had better food. The restaurant had to close its doors only 18 months after opening. I think that it was lack of management to provide excellent customer service and great food. It is a good example of supply and demand between food service and a restaurant . 

Give another example of a concept from this chapter.  For example I just used AirBnB to rent an apartment in 

San Francisco.  How did AirBnB affect the supply of rooms to rent in San Francisco?

Because you rented a room, your purchase effected the supply of the rooms to be lower in availability for the dates of your purchase. I will use an event that comes to mind, Cheyenne Days in Wyoming. During that event there were no available rooms in the hotels for that time because the demand is high, we had to rent a room 30 miles away and at a high cost for a cheapo hotel because we did not realize this."Number of Buyers Effect".  I have learned to plan ahead for major events if I expect to have the accommodations that I want.Good example of Supply and Demand.