Console Price and Games
The question
Video game consoles and the game discs played on them are complements. The market for game discs in Orindale is initially in equilibrium when a shortage of chips causes the price of the consoles to rise sharply. Show the effect of this change on the market for game discs, assuming all else is held constant. Show the effect on the Supply and Demand graph.
Drag a curve, or use the arrow buttons. Want the free-play version with every control? Open this graph in the sandbox.
Console Price and Games: the worked answer
On the Supply and Demand graph, Demand shifts left.
Why Demand shifts left
Consoles and game discs are complements, so a higher console price leads consumers to buy fewer consoles and therefore fewer of the discs used with them. The price of a related good is a determinant of demand, so the demand for game discs shifts to the left. The chip shortage raises the cost of making consoles, not discs, so the supply of discs does not move.
What happens to the equilibrium
The equilibrium price of game discs falls and the equilibrium quantity decreases.
The mistake students make on this one
The phrase "chip shortage" leads many students to shift the supply of discs left. Chips are an input to consoles, not to discs, so disc production costs are unchanged and the disc supply curve stays exactly where it is.
On exam day
For complements, write the chain out before drawing: pricier consoles, fewer consoles bought, fewer discs wanted, so the shift lands on the demand side of the disc graph.
How this is graded
The checker reads every curve's position before and after your answer. You are marked correct only when Demand shifts left and every other curve on the Supply and Demand graph stays where it started — the same standard an AP reader applies to a drawn graph: the right shift, and nothing extra. There is no AI involved; the rubric is the geometry.
More Supply and Demand scenarios
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