Imagine you're selling lemonade. If only a few people want it, you can charge more money for each glass. But if everyone wants it, you have to lower the price so more people will buy it. This is how price differences happen in real life, when there's not enough of something, it costs more; when there's plenty, it costs less.
Examples
- A hot dog at a football game costs $10 because people are willing to pay a lot for convenience.
- A toy in a store costs less than one in a vending machine because the store has more of them.
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See also
- Why Are Some Things Incredibly Expensive and Others Almost Free?
- Why Are Some Things Incredibly Expensive — And Others Cheap?
- What are rising costs for businesses?
- What is Cost-push inflation?
- How Does Gold Stay Valuable Over Time?