Seven Facts Of Economic Life

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The Value of everything is Subjective

You as the consumer are willing to part with your hard earned money only if the product meets you demanding needs. Depending on how bad you need a certain product determines the amount of money your willing to pay for it. Now depending on need or popularity of the product in question determines what the supplier is will to part with it for. So value is truly in the eye of the beholder. There are several things to consider when determining the subjective value of something:

Wants and Needs: The wants and need of the consumer will determine the price at which the supplier is willing to part with his product. If this years hot Christmas toy is Action Jackson and every boy in the world has to have one then the price will be set high enough to make a considerable profit for the supplier and at the same time be set low enough that the consumer is willing to part the set dollar amount so his kid won’t be the only one on his block that doesn’t have Action Jackson.

Supply: If Joes Action Figures only produced a limited amount of Action Jackson dolls and didn’t see this craze for his doll then this will drive the price up. Now the manufacture and supplier have the upper hand here, he knows that all little boys will place his doll on the top of the list to Santa therefore, he is able to drive the price up. After all what dad would disappoint his son by not buying Action Jackson for him.

Income and satisfaction: Depending on you economic status and you willingness to provide for the happiness of your son can also determine the value of this action doll. If the price range is out of the question for your particular income then its value is less to you, if your sons happiness and the look on his face on Christmas morning the when he opens the box and finds Action Jackson then its value could be priceless.

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