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If you make a product with low margins it is much better for you to under-produce rather than over-produce. I suspect this makes it somewhat hard to restart th
by nullc 5y ago
If you make a product with low margins it is much better for you to under-produce rather than over-produce.
I suspect this makes it somewhat hard to restart the economy as there isn't any surplus of a lot of materials. And since downstream consumers are blocked, they fail to generate the demand needed to justify bringing up production.
- mmmBacon 5y agoSemiconductor companies traditionally operate at high gross margins close similar to software companies. https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/margin.html https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile...
- nullc 5y agogood point, though not necessarily true for the upstream outputs they consume!