Mass production reduced the price of many goods.

And so the first of these that I will focus on the first is the price of competing products.

And then they would take a loss.

And so what would happen if the price of a related good

(Laughter)

And so, once again, if the price of related goods... well, it depends which related goods... but if the price of productive substitutes, so the price of other things I could produce... if the price of other things

VAT is inserted at the end of the value chain and clearly declared.

How much will it cost you and your spacesuit to go to orbit?

But one of the things that we always tend to confuse is the difference between a revenue model and pricing.

Let's look at these cases a little bit more carefully and figure out what's going on.

When economists refer to inflation today, they are referring to a general increase in the level of prices of goods and services.

And you can imagine the other way, if the Kindle's price went down, then that would shift my demand curve to the right.

I'll give you some examples.

It is a complement. WRlTING

I mentioned them earlier, but a common startup error on day one is let's price on cost.

And housing prices continue to fall even as the latest economic stimulus package fights its way through...

And that's very important, because so many things hit the market at a price and then drift up.

If it's a physical product, you're going to develop sales collateral, meaning the data sheets and price lists and demos, etc.

The word arbitrage sounds very fancy, but it's actually a very simple idea.

But to make it more real, if the price of an automobile had fallen as rapidly as the price of computing power, you could buy a car today for five dollars.

And luckily for us, it is a fairly intuitive idea.

The quantity demanded will go down, and you can imagine the other side of that.

And then, as they went down, they kind of understood.

If you ever think about it, pricing that you negotiate yeah, we kind of have this price on paper, but that's just the starting point of the conversation.

The price of everything increased.

The other thing we assumed that's being held constant is price expectations for our good.

We have talked a little bit about the law of demand which tells us that, all else equal, if we raise the price of a product, then the quantity demanded for that product will go down. ..common sense.

You have a sales force and you're selling directly to the end consumer.

A retailer in the United States called Sears had a line of tools that they sold to people who made things and their product line always had three types of products good, better, and best.

And the cost of a transistor cycle, which is a measure of the price performance of electronics, comes down about every year.

So this is the more formal definition of GDP

A bit like inflation you over issue currency, you get what you see, declining prices.

As expected, the price of imported goods rose.

Gee, if you're buying one product, are there any accessories or companion products that you ought to just figure out to make sure that you customers are aware of or on the pricing page or on a price list say

Sometimes water becomes a precious commodity.

On the other hand, if you bid down here, and if c snuck in in between what your bid is and what the valuation is, then you've lost the auction, and you get a zero, but you should have won or it would have been worth your while to win because the price still would have been a bargain to you.

Because the alternative to pricing on cost is pricing on value.

Expectations... Expectations... of future prices. So let's say...

And the other?

One of the things that we held constant to move along one demand curve, for the demand itself not to shift for the curve not to shift is price of related goods.

You're gonna make more money if a crop fails.

Then auctions like eBay are another example of dynamic pricing.

With this price, your product would not be competitive in the Japanese market.

You'd end up with a negative utility.

And now we move up to the our item.