Quality / Price = Value

This is yet another vague and abstract topic, but it still means something – insofar as our buying choices in a capitalist economy are varied.  I suppose in the USSR your options are “generic, generic and generic” – all shitty, when they’re available at all.

 I reduce the formula to Q / P = V where

Q          =          quality

P          =          price

And

V          =          Value.

 This results in the following outcomes:

a)         If you raise quality relative to price, you increase value. 

b)         If you lower quality relative to price, you reduce value

c)         If you increase quality, but increase price even more, you reduce value.

d)         Similarly, if you reduce price, but reduce quality even more, you also reduce value.

 If you were to chart price and quality on a graph, with x axis being price and the y axis being value, you would probably wind up with a bell curve.  The cheapest stuff is crap.  And the most expensive stuff is a bad value because the marginal cost far exceeds the marginal benefit.  So items in the middle are the best value.  For any item there will be an equilibrium point of maximum value where additional expenditures do not offer correspondingly higher quality, thus value drops off.  This, however, not completely objective as “quality” is by its nature subjective and some features mean more to some people than others. 

 “Cheap” people claim to be focused on value but in reality simply take the cheapest item as a matter of principle, even if a slightly more expensive item has a much higher quality, i.e. is a better value.

 Extremely rich and status-conscious people at the other end of the spectrum pay top dollar for the highest quality even if it means ignoring value.  They are aware that they are ignoring value, their point is, “I’m rich enough to be able to afford to be indifferent.”

 The rest of us, with limited budgets but some appreciation of quality, prefer to actually focus on value and seek it in the goods and services we purchase.