Economic question: if the economy improves in the future, for instance inflation is eliminated, will prices of goods go down?

posted 66 days ago by Dumbpassword 66 days ago by Dumbpassword +37 / -0

We just spent $100 for lunch at Chili's. Would Chili's ever lower the price of their hamburger to pre-inflation prices?

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– TheGr8Pumpkin 12 points 66 days ago +12 / -0

They will have to when competitors have lower prices. And new business start popping up giving better value.

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– Nurarihyon_no_MAGA 7 points 66 days ago +7 / -0

It's basic economics: The ratio of supply vs demand determines prices

Lower supply / Higher demand = Prices rise 📈
Higher supply / Lower demand = Prices drop 📉

Market competition tends to always increase supply, therefore reducing prices

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– kosher 4 points 66 days ago +4 / -0

Money itself has a supply and demand curve so the other side of the equation is the monetary supply and money velocity. MV=PQ. This is how Milei is halting inflation in Argentina by restricting money velocity. He is doing that by limiting ATM withdrawals to $45 a day.

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– BurnNewHistoryBooks 5 points 66 days ago +5 / -0

Economics 101. Supply and Demand.

I bought Thomas Sowell’s book, waiting for it to arrive.

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– TheGr8Pumpkin 3 points 66 days ago +3 / -0

Good choice. Competition is the backbone to a great economy under capitalism.

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