Friday, August 8, 2008

Competition and Economics

While I was driving home from work a day or two ago I noticed that two name brand gas stations were advertising gasoline at $.20 difference from one another. They were right next door to one another and both common brands. How can this be? How can the station with the higher gas stay open and be competitive? I have noticed this repeatedly over the last couple of years and I still don't understand it. Sure, a couple cents difference I could understand, but $.20? All I can figure is the more expensive station was closer to the interstate and they gamble that someone pulling off for gas will stop there first. Or more people have that station's gas credit card than the other stations. I don't know. This is really a befuddlement to me...

I also don't understand eBay. I do a lot of shopping, searching, selling, etc. on eBay. I don't understand how some people will pay retail prices or more for items on eBay they could easily find at their local Wal-Mart, K-Mart, mall, etc. Or why someone will pay retail for used items again that could be found at these same locations brand new. Then they pay shipping and handling on top of all of that. All I can figure out is they are remote or just hate to get out and shop. But then I think that so many stores and shops now have online stores and usually good deals on shipping. Again, this is a befuddlement. I just don't understand some shopping trends.

What are your thoughts or insight?

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