Discuss the supply and demand of the Wii system.

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The supply and demand of the Wii system depends on the current interest in Wii games and gaming consoles and the competition Nintendo faces with other similar gaming companies. The cost of production affects supply to some degree, but certainly competition and consumer desires affect the supply to a greater degree. If, for example, a competitor of Nintendo's Wii system is putting out equally desirable games and consoles at lower costs, than Nintendo will either have to improve the quality and desirability of their products in order to justify the higher costs and less supply or will have to lower their costs and increase supply in order to continue competing. The demand of the Wii system will be mostly affected by Nintendo's ability to respond to consumer desires and continue to satisfy consumers with exciting, engaging, and fun gaming experiences.

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In general, the supply of Wii systems will be affected by the costs of producing the Wii.  As Nintendo becomes better at producing the Wii, costs would presumably go down since the company would have streamlined its process to reduce those costs.  Outside of that, the supply of Wiis would be affected by the prices of the components used to make them.  If a price of a needed input rises, the supply of Wiis will decline.

The demand for Wiis will be largely determined by customer tastes and by the prices of substitute goods.  For example, the Kinect might be seen as a substitute for the Wii.  If the price of Kinect systems goes down, the demand for the Wii will go down as well.  In addition, the market for such games is very much affected by what young people think is "cool."  If Wii continues to be seen in this way, demand for it will remain high.  However, if young people, for whatever reason, stop seeing it this way, its demand will drop.

These are some of the most important factors that could impact the supply and demand of the Wii system.

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