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Supply and Demand: E-Readers in Short Supply for Holiday

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Robbie Trencheny, an 18-year-old high school senior, loaded half a dozen textbooks and novels into his Nook digital reading device as soon as he received it as a birth-day present from his parents this month.
"I don't have to carry textbooks with me anymore," said Trencheny, who also bought a few books on the device for leisure reading. "Plus, e-books are cheaper than most normal books." But Trencheny was one of the lucky ones. Barnes & Noble Inc.'s Nook reader,which can hold 1,500 digital books, was sold out weeks ago, and anyone ordering it now is not expected to receive it until February.

Note: If prices is below equilibrium, the quantity demanded exceeds the quality supplied. The willingness to pay the advertised (list) price of $259 didn't ensure purchase of a Nook e-reader in 2009.

Question: Show graphically the market situation for Nook E-Readers at Christmas 2009.

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Solution Summary

Solution illustrates the given scenario with the help of a graph.

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Please refer attached file for graph.

Demand curve of Nook e-readers is shown by D and supply curve of Nook e-reader is ...

Solution provided by:
Lokesh Jain, MSc
Education
  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
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