(July 17, 2011 at 12:20 pm)Rhythm Wrote: Well, people could always stop using their service. It would be irresponsible for the managers of this operation to charge any less than exactly as much as a consumer would pay. There are investors to satisfy, at the very least.
Lets say you loaned a friend $100 dollars to start a business selling a product at the rate of $1 per unit. You asked him why it was taking so long to repay you, and he pointed to the $1 unit price, against his costs, etc. Now, if you knew that your next door neighbor was selling the same product at 2x the price of your friend, and that he sold out every day..would you not politely suggest to your friend that he increase his price and repay you sooner?
Not exactly. Im not even sure if your example is something that actually happens in real life. Keeping prices low and salaries decent will help ensure a products lifespan I would think. But, then again, there is no exact way to be 100% sure of such things. There is risk, but to a point. For the ammount I "loaned" in this example, I would not be so impatient for a return. I would suggest that he investigates the competition and find out why the differences are so largely inverted.
