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Why is it important that prices are flexible in our economy? Do you think the government should control the level of prices for products that are really important, i.e., gasoline?
I believe flexible prices are important because higher prices provide producers with more money for resources, therefore continuing production. Lower prices provide consumers with affordability and sometimes a sense of accomplishment. I think the government should have a hand in the decision on prices solely because some companies could potentially raise prices to ridiculous amounts, therefore, creating scarcity for the poor and middle class. But with some companies such as oil companies, they accumulate such a large revenue that gas prices should be capped off at a lower price, or even to match the average cost of living.
What's your thought?
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