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> I don't believe an increase in taxes would cause supply to increase. Sorry, i meant increase proportionally to demand (because demand would go down, so there
by sofixa 4y ago
> I don't believe an increase in taxes would cause supply to increase.
Sorry, i meant increase proportionally to demand (because demand would go down, so there would be more supply than demand).
> With fewer dollars in everyone's pockets, the winning bid will be lower, even if the bidders are just as hungry
Not if the winning bid comes from another country, or the supplier can afford to wait (because remember, we're talking about inelastic goods - the supplier knows people need to eat and heat themselves).
- deleted 4y ago[deleted]
- jbay808 4y ago> remember, we're talking about inelastic goods - the supplier knows people need to eat So why did a loaf of bread cost 5 cents in 1900 and 5 dollars now, even though we make more bread than ever (and with less labour too)? Couldn't the producers have "afforded to wait" until the desperate masses paid $5 per loaf, even if that were a whole week's salary? Or perhaps the nominal amount of money in a customer's pocket is relevant to the clearing price, even for bread and oil?