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RE: the discussions regarding stations selling gas at much higher (or lower) prices than you paid when it went into the tank. The argument that one should ignore sunk costs is correct, but evidently hard for some people to see. I have a real life example that may help illustrate this from a different angle.
I worked for a business that insisted on at least a 10% markup on any item in stock, or a 15% markup on items special ordered. They had been in business for years and had lots of parts in stock. In some cases (electronics) the part in stock had dropped enough in price that I could special order one and sell it for a 25% markup and still beat the retail price of the one we already had in the back at a 10% markup… and the store didn’t see any problem with this. Result: the back was crammed with parts (some years old) that were steadily going down in price, while I did a brisk business special ordering the very same parts!
On the other hand, some parts (mechanical items like motors or switches) would rise over time. If a part had been in stock for a while and it was sold at a 10 or 15% markup, it was below (current) dealer cost. Some other dealers in the area knew this and would check with us before ordering parts. This often resulted in us selling a part to another dealer and immediately ordering a replacement at a higher price.
Moral: What the stuff in stock cost when you bought it is irrelevant.
All you look at is (a) What it is worth today, (b) what it will be worth in the near future.
Disagree? Pretend you bought a house five years ago for 100k. The area has shot up in value as it has gone commercial. Now you need to move. Do you offer to sell your house for 127k (an excellent 5%/year appreciation), or are you influenced by the fact your neighbor’s property sold for 800k? Are you taking advantage of the buyer with 800% markup?
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