The same thing with the price of good x. In theory, it makes sense.
The problem is that many people buy things because they think they want to buy them. And when the price of something goes up so the price of everything else goes down, then it seems like the price of everything else will go down as well. But that’s not exactly true. Some things are so cheap that if they were the same price as everything else, many people would be buying less expensive things. But in reality, that’s not true.
What if you need to make money by selling something or other? Why? Because your money is worthless if you don’t sell it…
In the real world, prices are not set by the market or by the government. Prices are set by the people who want to buy a product or service. When the price of a product drops, the people who want to buy it will buy less expensive substitutes. In the case of a product that is made by humans, the people who want to buy it will buy less expensive substitutes because they will have to. But that doesn’t make the price of the product higher.
Good x and good y are both expressions of hope. In the real world, people are happy when good y is high, but in the real world, people are sad when good x is low. In the game played by humans, good x is high, but in the real world, people are sad when good x is low. We just say good x is good and bad x is bad.
If you want to make the best of the situation, you should always be thinking about the product that you are selling. If you are selling X, it makes sense to think about how good X is. If you are selling Y, it makes sense to think about the good things that Y has to offer. In the case of a product that is made by humans, the people who want to buy it will buy less expensive substitutes because they will have to.
If you think about the product in this same light, the best thing to do is to avoid substituting too many substitutes, because this leads to the “cheapness trap”. When a customer buys a low-end product that is made by humans, they will often substitute cheap products that are made by machines because they have to.
A product that is made by humans may or may not have a price. If the price is low, the consumer may use cheap substitutes, and if it’s high, the consumer may not. If the product is a good, or has a good quality, then people won’t have to substitute cheap substitutes. If the product is made by machines, then they will always have to substitute cheap substitutes.
If the price of good x, good y, or cheap x increases, then they will substitute cheap substitutes.
If the price of X increases, then the consumers will substitute better substitutes. If the price of X is high, then the consumers, or society, will have to substitute worse substitutes.If the price of good x decreases, then the consumers will substitute cheaper substitutes. If the price of X is low, then the consumers will substitute better substitutes.
