I'm not an economist, but it's not as simple as that. You've also got to consider economies of scale. For instance, suppose there are fixed costs of $10,000/day at a film production facility (for rent/mortgage, real estate taxes, security, etc.). If that facility produces, say, 1 million rolls of film each day, those fixed costs add $0.01 to the cost of the film. If the facility's output drops to 10,000 rolls of film a day because of decreased demand, the fixed costs add $1.00 to each roll of film, so the price will have to go up by $0.99 if the manufacturer is to maintain the same profit level per roll of film -- and much more if the manufacturer is to maintain the same absolute profit level. (These numbers are all just made up, so don't get hung up on them.) Similarly, it's usually cheaper for manufacturers to buy raw materials and other supplies in larger quantities, so as demand drops, material costs go up. Of course, if demand drops as dramatically as I've just suggested, the manufacturer is likely to close production facilities and consolidate production into fewer factories, assuming that's possible. That further complicates the analysis, but in the end, the principle of economies of scale is pretty simple: It's (usually) cheaper to produce something in greater quantities than in lesser quantities.
Also, could someone explain a little economics to me? I thought that when a product or service is in high demand, prices for that product/service will rise.
When there is little demand, the supplier will lower prices to stimulate buying.
The demand for film and paper and chemistry is falling(?), so shouldn't the prices be going down also? They seem to be going up. Why?