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  • Yes, prices will fall

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Thread: Supply & Demand

  1. #1
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    Supply & Demand

    Hypothetical:

    If there are a 1,000,000,000 units of product A, all effectively identical and someone adds 1,200,000 more to the market and demand is annually increasing at 3% (so 30,000,000) will that materially reduce prices?

    *Assume no barriers to purchase for all potential buyers.
    "If your opponent is of choleric temperament, seek to irritate him." - Sun Tzu

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    Re: Supply & Demand

    Quote Originally Posted by obvious Child View Post
    Hypothetical:

    If there are a 1,000,000,000 units of product A, all effectively identical and someone adds 1,200,000 more to the market and demand is annually increasing at 3% (so 30,000,000) will that materially reduce prices?

    *Assume no barriers to purchase for all potential buyers.
    If a tree falls in a forest...

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    Re: Supply & Demand

    Not if the business owner doesn't know what he's doing.
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    Re: Supply & Demand

    Quote Originally Posted by DrunkenAsparagus View Post
    Not if the business owner doesn't know what he's doing.
    I don't see how that matters. A mere 1.2% increase in goods that's easily outstripped by demand cannot possibly reduce prices where no barriers to purchase exists.
    "If your opponent is of choleric temperament, seek to irritate him." - Sun Tzu

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    Re: Supply & Demand

    Quote Originally Posted by obvious Child View Post
    I don't see how that matters. A mere 1.2% increase in goods that's easily outstripped by demand cannot possibly reduce prices where no barriers to purchase exists.
    Sorry, It's late, and I didn't see those extra three 0s. To answer your question, I don't think that it would affect price much. Nobody said that supply and demand is a 1:1 ratio.
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    Re: Supply & Demand

    Quote Originally Posted by obvious Child View Post
    Hypothetical:

    If there are a 1,000,000,000 units of product A, all effectively identical and someone adds 1,200,000 more to the market and demand is annually increasing at 3% (so 30,000,000) will that materially reduce prices?

    *Assume no barriers to purchase for all potential buyers.
    There are lots of other factors that could influence the price, but if everything else stays the same then the price should increase.
    Are you coming to bed?
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    Re: Supply & Demand

    Quote Originally Posted by Kandahar View Post
    There are lots of other factors that could influence the price, but if everything else stays the same then the price should increase.
    Indeed. My math is a bit off, it should be 2,338,251 additional product or 2.3% and 10,124,628 increase in demand (10.12%).

    If you can't guess, I'm subtly talking about something else.
    "If your opponent is of choleric temperament, seek to irritate him." - Sun Tzu

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    Re: Supply & Demand

    Quote Originally Posted by obvious Child View Post
    Indeed. My math is a bit off, it should be 2,338,251 additional product or 2.3% and 10,124,628 increase in demand (10.12%).

    If you can't guess, I'm subtly talking about something else.
    I figured, but I wasn't sure what.
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    Re: Supply & Demand

    Quote Originally Posted by obvious Child View Post
    I don't see how that matters. A mere 1.2% increase in goods that's easily outstripped by demand cannot possibly reduce prices where no barriers to purchase exists.
    It's not going to reduce prices from the original starting point, since as demand is increasing faster than the supply. So with demand outpacing supply, prices will increase. However, prices will be slightly lower compared to if 1.2 million extra units had not entered the market. And whoever added those extra units will probably make a tidy little bundle in the process. I have a feeling I know what commodity you're talking about, but I'll wait and see.
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    Re: Supply & Demand

    Quote Originally Posted by Psychoclown View Post
    I have a feeling I know what commodity you're talking about, but I'll wait and see.
    It's a three letter word. And for some reason most people just can't understand how basic supply and demand function with it.
    "If your opponent is of choleric temperament, seek to irritate him." - Sun Tzu

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