What does a relative price compare?(1 point) Responses The price of one good or service compared to another similar one The price of one good or service compared to another similar one The price after sale discounts are applied The price after sale discounts are applied The price that a seller wants to pay to the price that the seller actually pays The price that a seller wants to pay to the price that the seller actually pays The price that buyers pay compared to the price that sellers ask
The price that buyers pay compared to the price that sellers ask
The correct answer is: The price that buyers pay compared to the price that sellers ask.
A relative price compares the price that buyers pay to the price that sellers ask. To understand this concept, you can consider the following example:
Let's say you are looking to buy a laptop. You find two laptops that are similar in terms of specifications and features, but they are priced differently. Laptop A is priced at $800, while Laptop B is priced at $900. In this case, the relative price would be the price that buyers (you) pay for the laptops compared to the price that sellers (the stores) ask.
So, the relative price of Laptop A would be $800, and the relative price of Laptop B would be $900. By comparing the relative prices, you can determine which laptop offers a better value for your money.
In general, relative prices are useful for comparing the prices of different goods or services that are similar in nature. They allow buyers to make informed purchasing decisions based on their preferences and budget.