Talk:Menu cost/Archive 1

confused about Figure 1

I'm a little confused about Figure 1. Shouldn't N be at the maximum of the light blue curve (as in Figure 2), rather than a little to the left? But perhaps I don't understand the figure properly. Terry (talk) 20:51, 16 May 2008 (UTC)

Contradictory statements about zero menu costs

In the section Menu cost#Would Z ever be Zero?, the statement it seems unlikely that changing the price of a product would ever cost zero is immediately preceded by an example of an area where the menu cost is virtually negligible: the constantly changing prices of airline tickets.

This seems self-contradictory. Airline tickets are constantly repriced at essentially no cost to the vendor; the menu costs are effectively zero. (Indeed, prices are constantly shifted in order to maximize the revenue of the air carrier.) TenOfAllTrades(talk) 15:09, 28 July 2009 (UTC)

Actually, the cost exists. However due to the fact of high profit coming from very non-sticky prices, the companies adapted a system that reduces long-term menu cost. But this comes at investment price. Imagine putting this to work in grocery shop, for maximizing profit on bread. The cost of investment seems high compared to possible benefit, especially considering decrease in customers' comfort. E7th04sh (talk) 12:05, 17 November 2011 (UTC)

Menu cost over time

The example shown in article is misleading. The company does not consider a particular price change, but a prospect. The menu cost is compared to benefit in relation with price change, but also time. Even if the market price change is severe, change in price will give as much benefit as the change in total profit, that is number of transactions multiplied by profit margin. If the price was changed per transaction, then we could compare the menu cost with change in markets. But if the prospect is stable, then even little change in markets might be enough stimuli for a change in price. In effect, set aside effective calculation of exact timing and value, the rate of price changes depends on the prospect of market changes, rather than the single decision of a change depending on a single market change. If there even was something as infinitesimal as a single market change. E7th04sh (talk) 12:14, 17 November 2011 (UTC)

History

Perhaps come picture of a relevant economist would be effective in this article. I have access to a modern macroeconomist which i used to write the section. — Preceding unsigned comment added by Ahahaha373 (talk • contribs) 06:49, 30 March 2012 (UTC)