Chapter 12 Undestanding Markets
Chapter - 12 Undestanding Markets Buyer and Seller Interaction:- The buyer and seller discussed the price of the goods being sold. Initial Offer:- The seller quoted a high price for the item. Counter Offer:- The buyer offered a lower price, stating it was too expensive. Bargaining:- Both parties exchanged reasons — the seller explained quality or scarcity, the buyer emphasized budget or availability elsewhere. Agreement:- Finally, they agreed on a mid-point price acceptable to both. Outcome:- The transaction was completed, showing how negotiation helps in settling on a fair price in markets. Prices and Markets 1. What happens if the seller fixes the price very high? Buyers may not be willing to purchase. Fewer transactions take place. The seller may not earn as expected. Leads to unsold stock of goods. 2. What happens if the seller fixes the price very low? Many buyers will want to buy. Seller may run out of stock quickly. It may not be profitab...