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<blockquote data-quote="Celebrim" data-source="post: 4331735" data-attributes="member: 4937"><p>Yes, and no. You can sell something for whatever the customer is willing to pay, but that doesn't really provide us any explanation for why something has the price that it does. </p><p></p><p>If you set a certain price far in excess of your cost, then observers will percieve that they can manufacture or obtain the good themselves and sell it at a lucrative profit while undercutting the price point you've set.</p><p></p><p>If you set a certain price far in excess of your cost, then buyers will percieve that the costs of going elsewhere to obtain the product more cheaply are smaller than the costs of obtaining the product here. </p><p></p><p>If you set a certain price far in excess of your cost, then buyers will percieve that there are similar products which they can substitute for your product at a lower cost.</p><p></p><p>If you set a certain price far in excess of your cost, then buyers will question the utility of the product at that cost. That is, they may note that they cannot realize a profit from the purchase of your product.</p><p></p><p>All of these factors together limit what you can reasonably charge. </p><p></p><p>However, I wasn't attempting to assert any sort of formal ecnomic theory with respect to how the price of goods is set. I was merely grabbing a range of numbers I thought representative of what is actually observed in the market. That is, regardless of how prices are actually set, if you examine the market sellers are setting prices that are roughly a 50% markup. Various factors - some of which I mentioned - effect that, but 'you can sell things for what buyers are willing to pay' is utterly nonexplanatory from a mechanical perspective.</p><p></p><p></p><p></p><p>Again, given that 'run a merchant company' is something a great many groups have historically done when playing a D&D game, how is your answer any different than saying, "Sounds like badwrongfun to me."?</p><p></p><p></p><p></p><p>That is either a serious failure of imagination or a terrible amount of hubris, or perhaps both.</p><p></p><p></p><p></p><p>So you are suggesting that a modern business simulation is a useful model of running say a 16th century inspired high seas merchantile company on a fantastic world where magic and monsters abound? Are you really suggesting that such 'small business simulation games' would be useful, or is this in fact just a snarky dismissal of the OP in disguise - the polite equivalent of saying 'Go away. We don't want your kind here?'</p></blockquote><p></p>
[QUOTE="Celebrim, post: 4331735, member: 4937"] Yes, and no. You can sell something for whatever the customer is willing to pay, but that doesn't really provide us any explanation for why something has the price that it does. If you set a certain price far in excess of your cost, then observers will percieve that they can manufacture or obtain the good themselves and sell it at a lucrative profit while undercutting the price point you've set. If you set a certain price far in excess of your cost, then buyers will percieve that the costs of going elsewhere to obtain the product more cheaply are smaller than the costs of obtaining the product here. If you set a certain price far in excess of your cost, then buyers will percieve that there are similar products which they can substitute for your product at a lower cost. If you set a certain price far in excess of your cost, then buyers will question the utility of the product at that cost. That is, they may note that they cannot realize a profit from the purchase of your product. All of these factors together limit what you can reasonably charge. However, I wasn't attempting to assert any sort of formal ecnomic theory with respect to how the price of goods is set. I was merely grabbing a range of numbers I thought representative of what is actually observed in the market. That is, regardless of how prices are actually set, if you examine the market sellers are setting prices that are roughly a 50% markup. Various factors - some of which I mentioned - effect that, but 'you can sell things for what buyers are willing to pay' is utterly nonexplanatory from a mechanical perspective. Again, given that 'run a merchant company' is something a great many groups have historically done when playing a D&D game, how is your answer any different than saying, "Sounds like badwrongfun to me."? That is either a serious failure of imagination or a terrible amount of hubris, or perhaps both. So you are suggesting that a modern business simulation is a useful model of running say a 16th century inspired high seas merchantile company on a fantastic world where magic and monsters abound? Are you really suggesting that such 'small business simulation games' would be useful, or is this in fact just a snarky dismissal of the OP in disguise - the polite equivalent of saying 'Go away. We don't want your kind here?' [/QUOTE]
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