sc94597 said:
I noticed that you didn't address my scenario. In that scenario does the Wii U have more value than the XBO because any person will buy it before an XBO? Value is exactly prefence. Just because the marginal value of the XBO is greater in your scenario does not mean its total value is greater. And yes, people do pay more or less than market price in many real-world situations. "In economics, market price is the economic price for which a good or service is offered in the marketplace. It is of interest mainly in the study of microeconomics. Market value and market price are equal only under conditions of market efficiency, equilibrium, and rational expectations." ^ Is not always true. http://www.parjustlisted.com/what%E2%80%99s-the-difference-between-price-and-value/ The debate over “prices” and “values” is a very old and famous one in economics, perhaps 250 years in the making. In the short run, it is quite possible to find prices higher or lower than values due to unusual events or rapid changes in market conditions. In the long run, price equals value due to market forces. We make decisions in the short run. Therefore, it is possible that prices will exceed values (this is typically called “over-valuation”) or prices may be less than values (this is called “under-valuation”). If there were no differences between value and price, under- and over-valuation would have no meaning. Researchers and analysts study markets in attempting to identify situations where there is over- or under-valuations. We can observe prices (as reported by MLS offices from actual transactions) but we cannot observe values. The latter must be estimated in careful studies by statistical analysis.
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Still an "A" for effort- but your aim is getting worse- You are talking about "inneficient markets" and the definitions you are using are typically applied to investments like Real Estate, stocks and bonds- The value of investments rise and fall over time- The value of a current/recent gen video game console, like virtually all modern technology will always drop over time (unless it becomes some rare colllectable 30 years from now)