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Prices are set to maximize revenue. Most companies aren't going to lower prices just because they can afford to; cost savings should (and usually do) go to shar
by zaccus 8y ago
Prices are set to maximize revenue. Most companies aren't going to lower prices just because they can afford to; cost savings should (and usually do) go to shareholders.
- Kalium 8y agoYou're right! Costs savings, in isolation, will invariably go to highly privileged shareholders. With that said, what do you think happens when a second company in the same sector starts to realize the same cost savings, and realizes they can move more units by using the cost savings to lower prices and ultimately return even more to shareholders? Again, you're completely right. Companies don't lower prices out of the goodness of their cold, black, capitalist hearts. Yet, might there be other factors at work here?