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Prices are always based on demand, not costs. So the difficulty of creating something is irrelevant to its price in the market. If there is a perfect substitu
by trunnell 16y ago
Prices are always based on demand, not costs. So the difficulty of creating something is irrelevant to its price in the market.
If there is a perfect substitute for a good, competition might drive the price down. In a perfect market, the price of a perfect commodity will equal its cost (in theory), but in practice there are no perfect commodities-- not even toilet paper.