if I remember my X and Y economic diagrams.. in an open business competition ( unlike the Electric company or the Gas company , and most towns , Cable) the way things work , is if you raise your price the less product that you sell. .Yet, Disney is complaining and laying off cast members because "attendance " and Hotel reservations are " down" at the Parks.. so explain to me again.. like I am a two year old. ( Denzel Washington) why the Walt Disney Company RAISED prices again.. including parking at the resorts and the parks and what not. .
Explain to me .. how raising the price .. the cost of goods.. in the World of Disney, breaks all the simplest of Economic formulas.. and how "raising the price" will now "add more people to the resorts and to the park.. and could you give a an on line 4 credit University course on this .. and how the Disney Company is immune to the rules of economics.. constructive criticism only.. and if you are going to defend.. please site a true economic formula or stance ..instead of saying that every thing Disney does is perfect.. thanks..
Several things going on here.
1) No evidence that attendance is down. Unless they start showing historical and present day attendance number for the individual parks you really can't know if attendance is down or up.
2) Yes if you raise prices you impact demand, but the slope of the demand curve is unknown. I might be very steep or very flat and that slope determines how much you impact demand with any given increase or decrease in price.
3) There are lots of factors in the cost of operating. Energy prices may go up impacting the cost of running the parks, the cost of healthcare provided to employees goes up it impacts the cost of operating the parks, the costs of mouse ears or other items can go up impacting the costs of operating the parks... lots of things you might not think of can impact the cost side and if you don't raise prices enough to cover the cost increases it doesn't matter if you have the same number of visitors every year your park will lose money vs the previous year unless you can cut costs.
4) Remember all the squawking about living wages and raising the minimum wage, when wages go up the cost to the employer is more than simply the difference in previous wage and the new wage. If the increase is 1 dollar that employer has to pay the additional dollar, plus they have an increase in the FICA and medicare amounts they pay. Some people don't realize that while you see 6.2% FICA and 1.45% Medicare that the employer has to match that amount so the dollar increase is really about $1.08 per hour... Then you have to look at the other things like the worker comp that is paid to the state on behalf of every employee they have... way more expenses behind every employee they have than you would ever dream of. Even if wages in Florida don't go up they are still going up for DLR and the way Disney lumps their parks together what happens in DLR impacts how their domestic parks are doing... so don't forget to account for that.
The reason they raised prices is that cost generally go up every year. It would be a rare thing for a business like an amusement park or hotel to see prices drop from one year to the next because at the very least inflation would increase your costs. Now I'm certain they are constantly trying to cut costs at Disney as I have certainly seen areas where that has happened over the past 10 or 15 years that we have been regular visitors... but to be honest the cost cutting has its limits and the low hanging fruit was probably harvested years ago. The end result of that in a business that is trying to cut costs is to start cutting people. The only other option they would have had would be to raise prices more than the have already and for whatever reason they felt that prices couldn't be raise more than they are right now so the only other option is going to be cutting more costs and in this case it means cutting people.
Now what would be interesting to see is the ages of the people they cut. If Disney is like most very large corporation their insurance is really self paid in that while they might have Blue Cross ro United or any other healthcare provider showing up as the employees insurance provider the reality is the insurance provider is little more than a sham because Disney would be reimbursing the insurance provider for all the costs they incurred. Yes you pay premiums to the insurance provider but those premiums are set by both the insurance provider and Disney together. Disney knows that the claims paid by the insurance provider will exceed the amount they get in premiums and Disney knows they will have to pay that difference... which leads to the dirty little secret in corporations, they know that older people cost them more money so when they see a chance to eliminate older workers they know it saves them a lot of money on the healthcare side. It is the reason in lots of layoffs if their are no unions in place the head that roll aren't the youngest they tend to be the oldest because it saves the company the most money even if all the employees were paid the same the saving in healthcare is huge.
So now you've got a lot more to think about than just x and y on a chart... and that's the problem with what you are trying to do. An economics class in college is only going to give you a nice theoretical view of a very simplified situation... in real life there will be a lot more variable that come into play and what may appear simple is rarely that.
