Originally Posted by
BuryRaven
Sure sure, but the concept if an inflated price based on equilibrium remains the same.
The difference n price of if x is 100x more today versus last year, there is a greater ability to inflate the prices beyond that.
Think of it like this, a pencil may cost 10 cents to the consumer, lets use it for simplicity sake.
Production per unit/pencil may be 2 cents, distribution, convexity and shelving 5 cents per, so it may be essentially 1-2 cents per unit sold in profit. The small sale per unit point makes it hard to jump the price from 10 to 100c/$1 (excluding inflation).
If you extrapolate this out, the larger the unit per price, you will of course see a larger unit per profit. As the profit margin increase as does price (high demand lower supply) the ambiguity of the margins are greater but are ideally set by market conditions.
I hope this makes sense, I try my best to break it down to the easiest way possible to understand, I'm by no means perfect at this but if any more explanation is needed im happy to help.