drops because they think these are high prices to pay for such goods or they think these are rare, desirable

items and the amount paid seems right.

LINK IT UP

Visit this website (http://openstax.org/l/celebauction) to read a list of bizarre items that have been purchased

for their ties to celebrities. These examples represent an interesting facet of demand and supply.

When economists talk about prices, they are less interested in making judgments than in gaining a practical

understanding of what determines prices and why prices change. Consider a price most of us contend with

weekly: that of a gallon of gas. Why was the average price of gasoline in the United States $3.16 per gallon in

June of 2020? Why did the price for gasoline fall sharply to $2.42 per gallon by January of 2021? To explain

these price movements, economists focus on the determinants of what gasoline buyers are willing to pay and

what gasoline sellers are willing to accept.
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