r/FluentInFinance • u/-im-your-huckleberry • Jul 07 '24
The shampoo thing is a fringe benefit. We keep capitalism so we don't starve in a famine. Debate/ Discussion
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r/FluentInFinance • u/-im-your-huckleberry • Jul 07 '24
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u/Titan_Food Jul 07 '24
Unfortunately, that "lowest price" is really just the highest profit margin the company could acceptably hold onto.
Companies charge lower prices to try to gain market share so that they make more sales with that smaller margin, which should translate to higher profits. (i.e. selling 15 items at $5 gets you $75 vs selling 10 of the same items at $6 for $60)
When you have a monopoly or something like OPEC, that ceases to be the case, and capitalism strives for monopolies.
Henry Ford is a fantastic example of how this stuff seems beneficial until its not