Prices
Prices and the occurrence excess supply illustrates a strong correlation. When the price of a good is set too high, the demand for the product will start to degrade until there is more quantity supplied than quantity demanded. The occurrence of excess supply either leads to lower prices or unsold supply. Lowering the price of a good enables consumers to start spending again as it has become affordable.
Read more about this topic: Excess Supply
Famous quotes containing the word prices:
“The earth only has so much bounty to offer and inventing ever larger and more notional prices for that bounty does not change its real value.”
—Ben Elton (b. 1959)
“To expect to increase prices and then to maintain them at a higher level by means of a plan which must of necessity increase production while decreasing consumption is to fly in the face of an economic law as well established as any law of nature.”
—Calvin Coolidge (1872–1933)
“United Fruit... United Thieves Company... it’s a monopoly ... if you won’t take their prices they let your limes rot on the wharf; it’s a monopoly. You boys are working for a bunch of thieves, but I know it ain’t your fault.”
—John Dos Passos (1896–1970)