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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Sun Tzu who wrote (29826)	4/29/1999 9:21:00 PM
From: Carl R.	Read Replies (1) \| Respond to of 70976

Yes, but the situation is more complicated than that because here we are dealing with two levels of supply and demand curves. The question here is what the impact of rising supply of memory chips and falling prices of memory chips will have on demand for equipment. What the market said today is that it expects falling prices of memory chips to reduce demand for equipment as DRAM makers delay capital acquisitions. Carl

To: Sun Tzu who wrote (29826)	4/29/1999 10:15:00 PM
From: Katherine Derbyshire	Read Replies (2) \| Respond to of 70976

>> >> Price declines in DRAM do what to volume? It depends on the reason in price decline. If it is due to increase in supply then your analysis is correct. But if it is due to a decrease in demand, then the volume will decrease. << You are correct in the general case. In the specific case of DRAMs, it's pretty safe to say that demand just doesn't go down. Computer owners know you can never have too much memory, and the further the price goes down the more they buy. Katherine