Blu-Ray Format Expected to Dominate, but When?

Blu-ray stomped HD DVD to become the standard format for high-definition movie discs, but years may pass before it can claim victory over the good old DVD. The people who bought

$2,000, 40-inch TVs are the ones that will lead the charge. Everyone else will come along when the price falls. Blu-ray machine prices are now starting to drop and Wal-Mart Stores Inc. began stocking a $298 Magnavox model. That’s cheaper than most alternatives, but a hefty price hike from a typical $50 DVD player.

Source: CNN, June 2, 2008

a. What does marginal utility theory predict about the marginal utility from a Magnavox Blu-ray machine compared to the marginal utility from a typical DVD player?

b. What will have to happen to the marginal utility from a Blu-ray machine before it is able to “claim victory over the good old DVD”?