So besides the fact that IKEA refuses to bring a store to Nashville (but there’s one opening in MEMPHIS this year?!? Seriously?!) …
…there is some pretty interesting mathematics behind the way they go about their pricing and purchasing options.
FiveThirtyEight wrote about it here: http://fivethirtyeight.com/features/the-weird-economics-of-ikea/
Read the article linked above.
Answer the following questions:
- If IKEA uses 1% of the world’s lumber every year as they claim, how much lumber is produced on the planet each year?
- Explain briefly why you think the price of the Poäng chair has dropped so much in the years since it was first introduced.
- Look at the graph they provided comparing prices of the Antilop high chair. Give three hypotheses about why the chair had a drastic price change in certain areas during certain years. Why might it have both drastic increases and decreases included on that graph??
- The author claims that IKEA is sui generis in the furniture world. Explain what that phrase means and give an example of another company that is sui generis in a different field.