why prices cannot be negative?

Question

is there something to do with wealth or utility maximisation?

I'M LOOKING FOR SOME MATHEMETICAL OR ANALYTICAL REASONS.it has to do some thing with wealth or utility constraiants.

Answer 1

If you are looking at wealth and the maintenance o f wealth with very little in the way of fluctuations, look into asset allocation and utility maximization.

Otherwise, this is a good answer why prices cannot be negative: The Agreement on Implementation of Article VI of the General Agreement on
Tariffs and Trade 1994 .
Look up the World Trade Organization 1994 GATT Anti-Dumping Agreement.

Answer 2

prices are the quantitative economical value of something, and it might reflect the cost of production, or them plus a superavit which is the earning.
For something that u get you charge, that requires a positive price. Having a negative price will mean that teh owner of the good would have to pay to the "customer" and under that scenario no buy is done because buying is the eschange of a service or good for money. and in this case there would be no exchange.
Basically a negative money would imply that the customer wouldn't have to pay, would receive the good and also money.

Answer 3

Because that would basically mean that the producers and/or sellers would pay to you just to take their products - you would get it for free. there is absolutely no reason for them to do it 'cause the costs of the production of the products would be higher than the revenues.

Since the motivating factor for the producers is the profit, there would be no reason for them to want to produce at all, 'cause if they did eventually all the companies would go bankrupt. It has nothing to do with utility maximization - it is related to consumers, not the producers.

Answer 4

Price is always stated as a positive number because that is the money you must "pay" for the item or service.

If the Price were negative, the seller would be paying you to take the item or service.

If they wanted to give the item or service to you the Price would be nothing or "Free."

Answer 5

It is called economics, You have a widget, Ol' bob needs a widget so you give him one...OK now everyone wants widgets, so you make more this is the Supply for the demand of widgets. so in order for you to make more widgets you have to get a widget maker from Jack that costs you...so you charge for the widgets you sell it is simple economics of a price being set by the demand. but if I can't make enough widgets then the interest will fall off and the demand will go down so will the price, so I can get rid of all these stinkin' widgets....Make sense

Answer 6

i googled this ...worth can be negative..prices=pennies usually positive...But here's good site for ya:

Compensated_demand
Since consumption and price move in opposite directions, the effect is said to be negative. ... individual behaviour is utility maximisation, and since any ...www.debunking-economics.com/Hedonism/Compensated/index.htm -



another scenario for ya:

spot price for electricity can go negative (PDF)
and the phenomenon that electricity prices can become negative close to the time of ... Negative prices are acceptable to power suppliers because ...www.maycroft.com/resources/Article negative prices 2003.pdf - 103k

Answer 7

Well, the simple answer is that if a vendor was selling something for a negative price, he would be required to pay you to take it away.

Answer 8

Typically if you are selling something it would have to have a positive value. Otherwise you would be giving it away (and not selling). A negative value would mean you would be paying them to take your product.

Answer 9

The name of the game is profits.
Negative value= no profits only a loss.

Answer 10

Prices can be negative! If you want to discard some waste materials you have to pay for it at times!