Case 5: CASE STUDY--The Art Market Case Studies ? CASE STUDY 5: The Art Market Yesterday, after work, you went to dinner with your colleague John. He was rather depressed and preoccupied by a substantial sale he felt he blew that afternoon. He related the following: "As you know, the recession has hurt our business and inventory is beginning to get costly; the word from above is to move things at a reasonable price as quickly as possible. So, when an art buyer from a large bank came into the gallery today, I was overjoyed. She wanted to purchase Persian rugs, wall tapestries, paintings, and period furniture for their executive offices, reception halls, and meeting areas. She told me she'd been in every gal- lery and auction house in the city and not found the quality she had in our gallery. "After some small talk and a review of her needs, we agreed on three full size Persians, six wall tapestries, two large 10-by-12-foot paintings, a dozen prints, and several period chairs and tables, for which I quoted $425,000. She smiled and offered 50 percent. I launched into my basic appeal about the market value of the items coupled with the tax breaks, compared that figure to the anticipated appreciation of the works in question, and then came down by 10 percent. She noted that the tax appraisal was less than market value on many of the items and that the art market was rather volatile and unpredictable. I responded by calling attention to the historical trends of the art market but still gave her another 6 percent off the