Answer:
When people buy something, they value it more than it costs them. But, when people sell something, they value it less than the payment they receive.
Explanation:
The cost of a product or service is the purchase price of a product. It is the amount of money that the buyer must pay the seller for the seller to deliver the product in exchange for this payment.
On the other hand, the value of a product or service depends on the subjective assessment made by the person with respect to that good or service.
In order to carry out this subjective assessment, the buyer can put into play emotional factors such as with whom he will share it, how much benefit he will report its use, the desire he has to obtain it, the experiences that will allow him to realize, the problems that he can solve, the possibility of acquiring a similar product or service in another way, etc.
On the other hand, the seller will make his own assessment taking into account the cost he had or will have to pay to obtain the product or service offered, the opportunity cost of selling it to another customer, the time he has to devote to perform the service or maintain A product in stock, etc.
To make the purchase decision, the cost (purchase price of the product should be lower than the value perceived by the buyer because otherwise he would surely decide not to buy it.
On the other hand, the sale price offered by the seller should be higher than the value perceived by him because he would otherwise decide not to sell it.
This mechanism explains why in a free commercial exchange (without any taxation between the parties or third parties) it is always beneficial for both the buyer and the seller, at least according to the valuation according to the personal criteria of each of them. .
This is probably the main positive and most powerful feature of the free market system.
