Submitted by Zondartul t3_z6vism in explainlikeimfive
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Submitted by Zondartul t3_z6vism in explainlikeimfive
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There are also natural and war disaster laws in place in most US states that stop price gouging.
Depends on where you are in the world.
Some countries have set controlled pricing for bread and the like to prevent arbitrary price hiking on basic goods.
But generally, the real limit you have as a vendor is whether your customers are willing to pay the increased price, or will a competitor undercut you.
It doesn't matter how much you make per sale if no one will buy from you.
The fact that you don't have control over the price of potatoes in general. You can sell what you own for whatever you want, but you have no power or authority over an entire commodity.
Assuming you’re in the US, you can charge whatever, with a few limitations
-You cannot jack up prices on essentials during a state of emergency (no doubling the price of food as people are stocking up for a big hurricane, for example)
-If you have a contract to provide a good/service at a predetermined price, you cannot increase the price for whoever you contracted with while the contract is in effect
-certain goods/services like some utilities and some types of insurance may have a cap on the percentage of profit the company can take or a minimum on the percentage of the cost that goes towards the actual service (under the ACA, 80% of medical insurance premiums must go to paying for medical treatment; electric companies can only take a certain percentage of profit off of infrastructure investments and must otherwise provide electricity at cost).
-Most monopolies are illegal (so you cannot buy all the toothpaste companies and then charge $50 for a tube of toothpaste once your competition is gone)
I think that’s pretty much it. Anything else? Go nuts.
Besides the other answers, there are certain circumstances where you have to charge above a certain price. [Dumping](https://en.wikipedia.org/wiki/Dumping_(pricing_policy)) is one of those circumstances, mainly in international trade, certain countries forbids you to charge so little that you drive out competition thus becoming a monopoly.
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You can, and people have, sell a picture of an Xbox or an empty box on ebay for $1000. As long as you clearly describe what you're selling.
In Sweden there are laws against that, both in criminal law and contract law. There are laws regarding price gouging, laws regarding emergencies (for example, if one is drowning it is not legal to sell them a life vest) and also laws regarding tricking people with “lack of mental capacity” into paying more than a reasonable price for an item. Basically it isn’t, in theory, legally allowed to exploit people.
However, there are no enforced limits regarding interest on loans (used to be 6% until the 1860s). A possible limit is currently being discussed. There are limits for the cost of renting your apartment to someone, however this is rarely brought to court since people firstly don’t know it is possible and also people value a second hand renting contract too high to risk losing their contract, unreasonable costs aside.
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nmxt t1_iy3aa67 wrote
Nothing stops you from setting whatever price you want, unless you are a monopolist or coming close. In that case there are anti-monopoly laws which are meant to prevent this from happening.