More Toy Suppliers, Good News for Consumers!
Toysrus.com and Amazon.com are no longer partners in the online toy world. The two broke ties this past March due to a ruling from a New Jersey superior court judge who found that Amazon.com breached a deal to give Toy R Us rights to supply toy products as a third party vendor. Not only due these two vendors need to worry about each other this holiday season but from other stiff competition: target.com, walmart.com, and eBay; all of which are expected to be aggressive with discounting. As consumers the supply will increase, therefore dropping prices. We will also have a more assortments and services at our disposal. Would it be smart for Toys R Us and Amazon to team back up, or stay independent?
1 comment:
Cayli, your economic analysis confuses the difference between a change in demand and a change in quantity demanded. If the supply of toys increases, then price will indeed fall. However, the drop in price will not increase demand--rather, it will increase quantity demanded (a movement down along the existing demand curve).
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