Problems with assiging monetary value
July 16, 2009 4:22am CST
Two tickets to the movies $14, a bag of popcorn $2.50, the time spent with a friend in a theatre ... priceless. One problem of assigning monetary value to things is that not all things can be assigned. Obviously time spent with a friend has different value to some people than others and to make this more complex it can also depend on the friend. Basically how I value a specific item and how you value it are two different things and to put a concrete price on that would be conflicting. So how does a market account for such things? The same is true for many public goods. Using this example popcorn at one theatre may taste better than popcorn at another theatre so how do you price those items? They are both popcorn but one is better in quality. This not only demonstrates the complexities of assiging monetary value to goods but how the market for some goods is distored by various factors. The fact that a yacht can cost more than a college students tuition proves this.
• United States
16 Jul 09
Hi, nicoledorn! Welcome to the Lot! Especially in this terrible economy, I can't imagine how prices can be justified. Prices for what used to be wonderful family outings have gone totally crazy! How can a family afford to go to a ball game or a movie when the tickets cost so much? Most prices seem to be based on whatever people can get away with! It's outrageous! My cousin is a major league baseball coach, but if he doesn't leave a free ticket at the box office for each of us, I can't afford to go to a game, and I have a fairly well-paid job.
• United States
16 Jul 09
Actually, there are many things that go on behind the scenes of movie production and running a theater that you are simplifying: Costs for a movie (and I may be missing some): 1) star(s) 2) cost of script (purchase rights to the book, screenwriter, revisions) 3) director 4) camera people (including gaffers, light people, 1st, 2nd & 3rd cameramen) 5) stunts (if applicable) 6) insurance 7) makeup 8) location expenses et. all I think you get the idea....and this has to be recouped through higher movie prices (unfortunately)...remember in the 90s and stars like Jim Carrey, Tom Hanks and Julia Roberts earning tens of millions of dollars for a movie, even if it flopped? And you can apply similar costs to a movie theater...although the cost of living is different in different areas, the dollar value is averaged amongst all of the theaters and a dollar value is given for the average so that they can stay in business. Spending an afternoon with someone that you treasure, or haven't seen for a while, is usually going to have a higher value to you than any fancy car, house or yacht is going to provide you even though you have them longer (I would hope).