Monday, May 9, 2011
The iPad 2
The iPad 2 will sell 1 million units faster than the 28 days it took the first-generation iPad to sell according to this article. The demand will eventually increase because the new tablet will be available in more stores, instead of just the Apple store. As the supply of a product increases the price will decrease because the producer will have more of the product to sell. The iPad 2 will sell at 236 U.S. retail stores and in more than 10,000 other stores, including AT&T and Verizon stores, as well as retailers such as: Target, Best Buy and Walmart in the United States. The supply for the iPad 2 will be much higher than the iPad 1 because Apple expects to be in 27 countries rather than 10 for the first iPad. Apple CEO Steve Jobs launched the iPad 2 on March 2nd; one week after Verizon Wireless launched the Motorola Xoom Android. The iPad 2 is thinner, lighter and faster and includes dual cameras for video chat via Apple's FaceTime application. Even though the price will remain the same, the quality of the product is much better and it’s still offered at the same price. The better quality for a lesser price eliminates competition such as the Android xoom.
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I disagree with the statement that you said, “As the supply of a product increases the price will decrease because the producer will have more of the product to sell.” Producers have no reason to lower their prices if their supply is getting larger as long as the demand for their product is high. If there is a large demand then supply will go up along with the price. Firms what to make as much profit as possible and as long as consumers are willing to pay the price for that product, the demand, the price and the supply will increase. Eventually the supply and demand will come into equilibrium.
ReplyDeleteSantiago z