. Suppose you are a stock market analyst specializing in the stocks of theme parks, and
you are examining Disneyland’s stock. The Wall Street Journal reports that tourism has
slowed down in the United States. At Six Flags Magic Mountain in Valencia, California,
a new Viper roller coaster is now operating and another new ride, Psyclone, will be
opening this year. Using demand and supply analysis, predict the impact of these
events on ticket prices and attendance at Disneyland. As reported in The Wall Street
Journal, Disneyland slashed ticket prices and admitted that attendance was somewhat
lower. Is this consistent with your prediction using demand and supply analysis? In
light of the fact that both price and output were falling at Disneyland, is the law of demand
being violated in the world of fantasy?
yes
Suppose you are a stock market analyst specializing in the stocks of theme parks, and
you are examining Disneyland’s stock. The Wall Street Journal reports that tourism has
slowed down in the United States. At Six Flags Magic Mountain in Valencia, California,
a new Viper roller coaster is now operating and another new ride, Psyclone, will be
opening this year. Using demand and supply analysis, predict the impact of these
events on ticket prices and attendance at Disneyland. As reported in The Wall Street
Journal, Disneyland slashed ticket prices and admitted that attendance was somewhat
lower. Is this consistent with your prediction using demand and supply analysis? In
light of the fact that both price and output were falling at Disneyland, is the law of demand
being violated in the world of fantasy?
To predict the impact of these events on ticket prices and attendance at Disneyland, we can use demand and supply analysis. Demand and supply analysis helps us understand how changes in factors such as price, income, and preferences affect the quantity demanded and supplied of a good or service.
In this case, we know that tourism has slowed down in the United States as reported by The Wall Street Journal. Additionally, Six Flags Magic Mountain, a competing theme park, has opened a new roller coaster and will be opening another new ride.
Based on these events, we can make the following predictions using demand and supply analysis:
1. Ticket Prices: With tourism slowing down overall, the demand for theme park tickets may decrease. When demand decreases, prices tend to fall as businesses try to attract more customers. Therefore, we can predict that ticket prices at Disneyland may have been reduced due to the lower demand.
2. Attendance: The opening of new attractions at Six Flags Magic Mountain may attract some customers away from Disneyland. This could lead to a decrease in attendance at Disneyland if consumers prefer to visit the newer attractions.
Now, let's consider the reported information from The Wall Street Journal that Disneyland slashed ticket prices and admitted that attendance was somewhat lower. These findings are consistent with our predictions using demand and supply analysis.
Lower ticket prices indicate that Disneyland is trying to attract more visitors due to the lower demand caused by the slowdown in tourism. The lower attendance could be a result of consumers choosing to visit the new rides at Six Flags Magic Mountain instead.
In light of the fact that both price and output (attendance) were falling at Disneyland, the law of demand is not being violated. The law of demand states that as the price of a good or service decreases, the quantity demanded increases, all other factors being equal. In this case, the decrease in ticket prices is a response to lower demand, and the lower attendance can be seen as a result of consumers responding to the changes in price and attractions available.
Overall, the predictions made using demand and supply analysis align with the reported information, indicating that the law of demand is being followed in the world of fantasy.