Why are prices sticky? price changes are not easy to implement because?

2 answers:

7 0

Prices of a product do not change immediately. When a product is introduced in a market, the price associated with it is generally accepted by the consumers and with the passage of time the prices become sticky. They cannot be changed readily.

Price changes are not easy to implement because consumers are not usually willing to pay higher prices for the same product. And if it is done so, then they will switch towards the substitute of that product. So the implementation of the changes in price is difficult.

lutik1710 [3]3 years ago

4 0

Sticky prices is a term used to describe the price of a good or service that is not easily impacted to a change in the economy and their conditions. They stay relative to the price of the item and are used in short-term supply.
Prices can not easily change and implement within a market because you need to consider the economic changes/conditions and the consumer. How it will change things for the market and the consumer are not usually predictable until the price changes. Companies are also not able to judge how competition will fair when there is a change in price.

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