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That assumes that everyone who wants to buy tomatoes is able to buy them at current prices, and that everyone who is buying tomatoes now would no longer buy the
by crispyporkbites 7y ago
That assumes that everyone who wants to buy tomatoes is able to buy them at current prices, and that everyone who is buying tomatoes now would no longer buy them if the price went up.
If there are more dollars floating around in the economy, more people may be able to afford to buy tomatoes and more people become price insenstive (e.g. software engineers in SV do not care if tomaatoes are $2/kilo or $4/kilo, they'll still buy). As a seller you'll raise prices and see no drop in demand, ergo prices go up.