If everything was cheaper wouldn't business's make more money and wouldn't the economy be better?
Such as gas and food. Aren't we all looking for what's more affordable? If things were cheaper wouldn't you buy more....
If a cookie costs $1 to make, you can't sell it for less than a dollar without losing money. That's where China comes in. They might be able to make that cookie for half the cost with cheap plastic parts. Now you can sell the cookie for $0.75 and still make a profit!
Common goods are priced somewhat relative to their cost, so to lower the price to the end consumer, you need to lower the cost to make it. One way is to pay people (you) less. But if you do that, you are now earning less, and the discount on that cookie is washed out by your less income.
Would the economy really be better? In a way, you're right because some people would be able to afford more things. However, there would also be people who could only afford to buy less. Some companies could charge less and still make huge profits, so lowering the costs wouldn't hurt them as much. A company like I work for already has a lower profit margin because in the printing business you often have to underbid your competitors. If our salespeople lowered the prices much, we'd actually lose money on a lot of the jobs we do. There would still be a profit at the end of each month, but with the lower profit margin we'd have to downsize the workforce. Those who ended up losing their jobs wouldn't be able to afford even the new lower prices of other products.
by pgrundy 9 years ago
Just curious.My partner and I were talking about this last night while we were throwing the ball back and and forth with the dog. Both of us work pretty much all the time, way more than 40 hours a week each. We don't eat out, we rarely go to movies, we certainly don't wander around and shop for...
by Infopedia 6 years ago
If you had all the money you wanted, where would you live?
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