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"Coming Soon: A Theater Near You" Case Questions
Read the case "Coming Soon: A Theater Near You" (HBS 9-797-011). Then consider the following questions:
1. Are the trading relationships between the movie studios and the movie exhibitors stable? Which trading partner has more power at the time of negotiation to exhibit a movie?
2. Who has invested in "specific assets"? What makes them specific?
3. Who has bargaining power in this industry? Give evidence from the case for your answer.
4. Is there a hold-up problem in this case? What options are available to the exhibitors for reducing the hold-up problem?
5. Why are movie exhibitors opening large multiplexes and diminishing screen sizes?
6. Is there a bilateral hold-up problem? What are the possible solutions to the problem?
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