Macroeconomics teaches that if a product does not sell, it does not reduce the price, but rather reduces the quantity produced. On the other hand, microeconomics suggests lowering the price if it does not sell. Which one is better?
Prices are a strange thing, and there is also the opposite method, which is to lower the price and increase profits when something sells. In this case, the market share will be gained through lower prices and the profit ratio will fall. Everyone conducts business with the intention of incurring losses when adjusting quantities or prices. Setting a correct price is difficult, and setting a price can be said to be one of the most important management decisions. Although it is a harsh world where a difference of just a few yen can result in a deficit or a surplus, it is also one of the excellent systems for distributing various resources today. This is called market principle.
Generally, unless the product is perishable, such as food, managers respond to declining sales by reducing production quantities. The current market system is well balanced, meaning that it does not grow significantly, but it also does not deteriorate significantly. Macroeconomics or Microeconomics? It can be said that both areas have their advantages and disadvantages.
No comments:
Post a Comment