ACC 310F Study Guide - Midterm Guide: Montpelier, Vermont, Excess Supply, Shortage
Document Summary
Because capacity is often difficult to quickly adjust to customer demand, organizations such as your local movie theater often face situations where they either have demand in excess of their capacity or capacity in excess of demand. Each item below represents an alternative that your local movie theater may want to consider when there is a mismatch between demand and supply. Thus, this might be something for the movie theater manager to consider when there is excess supply. For example, movie theaters often discount movie tickets during the daytime when they anticipate having more movie seats than customers: raising the price of a movie ticket would decrease the number of customers willing to buy a ticket. Movie theaters may attempt this if they anticipate greater demand to see a particular show than their current capacity of theater seats allow: movie theaters may run special promotions in order to increase demand.
