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To: Egon

OK, if you sell 100 cups of lemonade for $1 apiece you make $100, and if you sell 200 cups at 50 cents apiece you make $100...but doesn’t it cost the seller more to make enough lemonade to fill 200 cups than to fill 100 cups?


12 posted on 10/05/2012 8:54:11 AM PDT by Verginius Rufus
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To: Verginius Rufus
doesn’t it cost the seller more to make enough lemonade to fill 200 cups than to fill 100 cups? -- VR

Now this is a very simplified model, it doesn’t take into account marginal costs or other factors, ... -- Egon

Of course it costs more in materials to make 200 cups of lemonade, and more for the cups, but the per cup material cost would be the same, or actually less (because larger quantities of materials can be bought cheaper because of bulk discounts).

13 posted on 10/05/2012 9:18:38 AM PDT by RhoTheta ("We're from the Government, and we're here to help you ... NOT")
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To: Verginius Rufus
doesn’t it cost the seller more to make enough lemonade to fill 200 cups than to fill 100 cups?

P = SR - C, or in other words profit equals sales revenues minus costs. If the sales revenues stay the same at $100, but the costs of producing 200 cups is higher than producing 100 cups, then overall profit decreases.

14 posted on 10/05/2012 9:28:34 AM PDT by mjp ((pro-{God, reality, reason, egoism, individualism, natural rights, limited government, capitalism}))
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To: Verginius Rufus
...but doesn’t it cost the seller more to make enough lemonade to fill 200 cups than to fill 100 cups?

As someone else pointed out, I purposely left out factors like that for this model.

...but: it goes directly to my point, which is: even the simplest real-world business/tax model cannot be reduced to "simple math".

Rachel Maddow, and Leftists in general should stick to what they do best: Adding their own snarky spin onto other peoples' talking points.

...or maybe that's what she was doing.

15 posted on 10/05/2012 9:36:35 AM PDT by Egon (Romney/Ryan. Because Jimmy Carter doesn't need a third term.)
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