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Text 963, 44 rader
Skriven 2006-06-08 23:43:00 av BOB KLAHN (1:123/140)
     Kommentar till en text av DANNY CEPPA
Ärende: Tax breaks
==================
 ...

 DC>> And the guarantee that that is how it is going to work
 DC>> is where, exactly?

 JM>> If Sherwin Williams and Pittsburgh Paint can both produce paint for
 JM>> 23% less than they currently can, don't you think one will try to under
 JM>> cut the other?

 DC> Not if they can make their sales target with their current
 DC> pricing structure.  After all, one great method of
 DC> increasing profits is to cut costs, not selling prices.

 ...

 JM>> Take that same principle and apply it to everything manufactured in
 JM>> the US. Do you think that DeWalt and Delta + 20 other manufactures of,
 JM>> say power saws, will all get together and conspire to keep what is a
 JM>> now an extra 23%?"

 DC> There is no incentive for them to cut their selling price.
 DC> Price only comes into play when 2 entities are selling the
 DC> exact same widget.  But, even then, other marketing tools
 DC> come into play.

 Actually, he's got you on this. Competition will force prices
 down. Price comes into play when they are selling similar
 widgets, not necessarily the exact same. People may pay more for
 bells and whistles, but all too often they will take fewer bells
 and whistles for less. Esp if the bells and whistles are not all
 that much less.

 What he forgets is, that exact same force can keep the company
 from passing on the payroll tax cut to the workers. They will
 get their part, but not necessarily the employers. Competition
 may force the company to cut prices by that 7%, not pass it to
 the employee.

BOB KLAHN bob.klahn@sev.org   http://home.toltbbs.com/bobklahn

... New Tagline Found! (Swipe/Ignore/Correct Grammar) ?
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