When prices are constantly increasing, it is easy to say: "wouldn’t it be nice if prices would just fall as often as they go up?" I’ll tell you why the answer is "no," and discuss some business concepts directly dealing with this question.
In a perfect capitalist system (without government intervention), there are two inputs and two outputs:
|
Inputs |
Outputs |
|
Capital |
Dividends |
|
Labor |
Wages |