Chuck Grimmett

Day 162 – A Contest

Yesterday during one of the question and answer sessions at FEE, one of the professors, Gene Callahan, brought up this hypothetical situation for the students to think about and attempt to answer, then he revealed the actual answer to us. So, since I occasionally ask questions on here for people to answer, I am going to post this one. Also, I will make it a contest. The first person to post the correct answer and valid explanation will receive a copy of Gene Callahan’s Economics for Real People.

Post your answers in the comments on this post. I will leave the contest open until 12:00 a.m. EST June 20, unless someone gets the answer correct before then. If someone gets the answer correct, I will post it in my update for that day, as well as notify the winner and post a comment stating that the contest is closed. One entry per person.

Please note: Attendees of the FEE seminar this week are excluded from winning, since you heard this from Callahan during the session. I will notify the winner and mail him or her a copy of the book.

So, here is the question:

Let’s say that Pink Floyd’s 1973 album Dark Side of the Moon sold 5 times as many copies than their 1971 album Meddle. Does this mean that consumers valued Dark Side of the Moon 5 times greater than Meddle?

(Note: These might not be actual sales numbers; this is a hypothetical question.)

Again, post your answer as a comment on this post. Answers must provide a valid explanation to go along with the “yes” or “no”.

Chuck Grimmett

Posted by Chuck Grimmett. Learn more on his About page.

Comments

3 responses to “Day 162 – A Contest”

  1. Mom Avatar
    Mom

    NO. The Dark Side of the Moon was more of a commercial success and reached more people than Meddle. That’s my answer and I am sticking to it!

    Reply
  2. Alex Dudek Avatar
    Alex Dudek

    No. Here would be an example, Meddle sells 2 millions copies to 2 millions different people. Dark side sells 10 million copes, to the same person say. Who knows, David Gilmour (guitarist of Floyd) was just making sure that Dark Side would be awarded the diamond award. If one person buys 10 millions copies, is that the same consumer value as 10 million people buying just one apiece? Not sure if that’s the right answer, but it’s definitely something worth acknowledging.

    Reply
  3. Amanda S. Avatar
    Amanda S.

    No.

    It means that there were 4 times as many people who valued Dark Side of the Moon than who valued Meddle.

    (Example: For 5 times as many copies to be sold, there would have to have been more people who valued Dark Side of the Moon than who valued Meddle. Lets say, hypothetically, that Meddle sold 50 copies. For Dark Side of the Moon to sell 5 times as many copies (so, 250), 4 times as many people (or 200 more people) would have to value Dark Side of the Moon than the number that valued Meddle.)

    So, the number of sales relates to the number of people who value the album, rather than the proclaimed “value” of the album itself. Value in itself is subjective, so by looking at the number of albums sold, one cannot determine the overall value of the album (there is no concrete value that can be placed on a product bought by numerous people for various reasons). All we know is that the number of people who felt that Dark Side of the Moon was worth their money was greater than the number who felt Meddle was worth their money.

    Reply

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