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6 terms

Chapter 5 The Productive Market Economy

It seems that items that take a long time to create, such as houses, would not be produced in time for when consumers are interested in buying them. It seems that by the time they are made, there would be decreased demand for them.
What is the difference between retail and wholesale?
What is "foodstuffs"?
Henry Courtemanche considers adding extra insulation to his house to reduce his winter heating bills. He telephones Warm Winter Contractors to inquire about the cost of such work. On learning that he would have to spend $6,000, Mr. Courtemanche tells the firm, "That's too much for me. I'll just nail plastic over my windows." Is Courtemanche sending a market signal? To whom? If hundreds or thousands of similar decisions were made in the city, what would happen to the insulation market?
Ola Swenson entered a bookshop near her apartment house, intending to buy an illustrated art book as a wedding present for a cousin. She found that the shop carried only popular paperbacks. Annoyed, she departed, after telling the proprietor, "If you carried really good books, you'd have more customers." Is Miss Swenson sending a market signal? To whom? In what sense is she "casting a vote"? If the store had carried other types of books before but had not been able to sell them, would the proprietor be likely to make inventory changes if Miss Swenson has been the only one to complain about the new stock?
Suppose that you were to ask for a box of clothespins at a small, privately owned store. The old man behind the counter tells you, "Youngster, we used to carry clothespins, but people were always asking for them! We couldn't keep them in stock, what with all that demand, and it was a nuisance always having to order more from the maker. So we don't bother to sell them anymore." Is the clerk properly responsive to market signals and customers' wants? What buying decision might you be induced to make as a result of his reply?