[ExI] Inflation graph

[Kelly Anderson]

On Sat, Nov 30, 2013 at 1:53 AM, Anders Sandberg <anders at aleph.se> wrote:

>  On 2013-11-30 00:36, Kelly Anderson wrote:
>
> That is a bit of a misunderstanding: it only applies to efficient
> financial markets. Economics also predicts that if you lower the price of
> your lemonade, more people will tend to buy it.
>

If you lowered the price of lemonade to zero, I still would not buy it.
Yucky stuff, it gets in your mouth and makes your face curl up in an
obscene fashion.

On a serious note, the thing you want to be able to predict is what is the
maximum profit to be made from lemonade? Sure, if it's free, more people
will buy it (still not me) but if it is a million dollars a glass, nobody
will buy it. But it's somewhere in between where the lemonade stand makes
the most money as a percentage of the money invested. And economics isn't
terribly good at determining that price as it is such an inexact science.
The folks at the Santa Fe institute have done really good work on
demonstrating just why economics is so hard. It's fascinating reading.

-Kelly
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