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PurseCase

by Charity-Joy Acchiardo

Jenn Deese and Kelley Coughlan pitch Pursecase, a smartphone case that also includes a front pouch that will hold an ID, a couple credit cards, and a small amount of cash. Kevin O’Leary asks them for the retail price of a PurseCase, to which they respond $38. He is flabbergasted at this high price and immediately argues they could change the price to $19.95 and sell ten times more than they are currently selling. In his mind, PurseCase is a product with a very elastic demand – so elastic that he thinks they could lower the price and collect much more in revenue. Based on the sales numbers given in the video, students can actually calculate the elasticity of demand for this product perceived by Mr. O’Leary. Students sometimes have difficulty understanding how a company can make more money by lowering the price of a product. This is a good example to begin that discussion. This clip is part of a collaborative research project by Charity-Joy Acchiardo, Abdullah Al-Bahrani, Darshak Patel, and Brandon Sheridan.

"Purse" Elasticity of Demand

Jenn Deese and Kelley Coughlan pitch Pursecase, a smartphone case that also includes a front pouch that will hold an ID, a couple credit cards, and a small amount of cash. Shark Tank: season 5, episode 10

from Shark Tank (2014)
Creator: Mark Burnett
Distributor: ABC
Posted by Charity-Joy Acchiardo
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