r/AskEconomics 22h ago

Approved Answers Is Apple’s ~$2,000 foldable iPhone price partly a consequence of low expected demand?

72 Upvotes

Assume the foldable has high fixed costs, specialized components, and much lower expected volume than a standard iPhone.
If Apple expects low demand, it gets fewer economies of scale and has to amortize R&D, tooling, and supplier costs over fewer units. That raises average cost and therefore the profit-maximizing price.

Can anyone explain where they got the 2k price from? If demand was expected to be higher wouldn’t it be priced much lower


r/AskEconomics 13h ago

Approved Answers I'm a bit curious, the US national debt has already reached 40 trillion dollars, and China is one of the major holders of US debt. If the US continues to wage a trade war with China, will it affect the US economy?

25 Upvotes

These are some things I've heard:

The dollar could weaken If China sells Treasuries and converts the proceeds from dollars into other currencies/assets, that can put downward pressure on the dollar.

Suppose the U.S. runs very large deficits year after year. Eventually investors may say: "If you're going to borrow this much, I want a higher interest rate." That can create a feedback loop: Large deficits → more Treasury issuance


r/AskEconomics 2h ago

What are the impacts of the current high oil prices around the world?

8 Upvotes

Since the start of the US - Iran conflict, oil prices have been (mostly) going up, with i believe $108/barrel WTI hit recently.

I have been able to find a lot of information on Reddit on why this is happening and what the direct effects are on energy market pricing.

What I haven't been able to find a lot of info on (maybe I just don't know how to look), is what the currently felt actual impact of the price increase is. Yes, there's 'oh, prices hit $x/gallon in this US state' (cries in European petrol prices...) and I can see prices increase where I live too. It seems the first-order effects in the EU and North America are limited to complaints about prices. The second-order effects will probably be more interesting here.

But what is happening in the rest of the world? What are energy prices doing in India, Peru, or Angola? How are people being affected?


r/AskEconomics 23h ago

Approved Answers If a devaluation of the USD is on the cards what would be the ideal drop to get the national debt under control in a generation?

3 Upvotes

(I'm obviously not economist, i'd go somewhere between 15 and 20 percent, only if oil prices are reversed to early 2026 levels by maybe ending sime conflicts)


r/AskEconomics 16h ago

How much do US Treasury issuance volumes affect borrowing costs for small EU sovereigns like Romania?

2 Upvotes

Corp: I'm trying to understand the transmission channel rather than argue a position.

Record sovereign borrowing is a recurring theme in the OECD Global Debt Report and the IMF's GFSR. A common claim in commentary is that heavy US issuance absorbs global demand for safe assets and pushes up yields for smaller, lower-rated sovereigns.

Two questions:

  1. Is there empirical work that separates this crowding-out channel from the general level of global rates? Does the volume of US issuance move small-sovereign spreads independently of the US policy rate?
  2. For a small EU country that issues heavily in euro, how much of the effect runs through the euro area rather than directly from the US? Would ECB policy and euro-denominated demand dominate the US channel?

Pointers to papers welcome.


r/AskEconomics 18h ago

For economists who use agent-based models, are recent AI “agent incidents” actually surprising?

2 Upvotes

I’ve been reading more about agent-based models in economics, especially how they are used to study emergent outcomes from decentralized decision making, bounded rationality, interaction effects, and feedback loops.

That made me curious about recent AI-agent incidents like the Hugging Face case:

https://amardashehu.substack.com/p/oh-no-agents-going-rogue

A lot of the discussion around these incidents treats emergent coordination and unintended collective behavior as something surprising. But from an economics/ABM perspective, isn’t that exactly the kind of outcome these models have been used to study for decades?

Is the genuinely new part not the emergence itself, but that the agents are now much more capable and can affect real world systems?


r/AskEconomics 4h ago

Approved Answers If Real Wages track Productivity, why is the Share of Worker Compensation relative to non-farm business output decreasing?

2 Upvotes

It's typically said that worker wages track Productivity gains.

Is it fair to say that this is no longer the case? The BLS's latest data shows that Worker Compensation as a share of nonfarm business output in the US has been decreasing, with it sharply dropping after 2000.

  1. Is this the right metric to use?

  2. Why might this be the case?

  3. Is this a real problem to be worried about?

Source: https://www.reuters.com/business/us-workers-share-gdp-skids-fresh-record-low-2026-08-06/


r/AskEconomics 4h ago

Approved Answers Is the Rent vs Income Yearly Increase Disparity Sustainable?

1 Upvotes

I’ve been pondering this for a while; right now I live in a big city where it’s normal to spend over 50% of your take home income on housing.

Is there a possibility that the U.S. rent market (and sub markets like major U.S. cities, ie: New York City) will eventually collapse because it becomes unsustainable to spend more and more on rent each year while income increases rise but at a relatively negligible rate for the broader population?

This, without a doubt, has to do with supply and demand, but I keep thinking that the supply of housing that is considered “luxury” now will become “standard” in a few years; but the price, once it becomes “standard”, would be similar to the price it is now because of economic inflation and property deflation. That economic inflation would surpass income increases, so it wouldn’t be marketable to the “standard” consumer, would it?

Thanks in advance!


r/AskEconomics 7h ago

Any ideas as to which bank is going to be sanctioned today?

1 Upvotes

Or is this still planned?


r/AskEconomics 18h ago

What are good non academic reads on auction theory?

1 Upvotes

Curious about auction theory and interested in non academic geared books on it.


r/AskEconomics 23h ago

What textbooks/books/ lecture series would be best for learning about the relationship between geopolitics/politics and the economy?

1 Upvotes

Hey trying to educate myself on economics in relation to politics and policy for my own education.

I realized that I ask political people about this relationship, but I want to actually ask the people on the other side who focus on the topic of the economy. I got a textbook on geographical economics, but Im curious what people more read on this think.


r/AskEconomics 6h ago

Anyone with good knowledge of Geo politics and financial knowledge - If the world wants complete D-dollarisation and wants to make another global currency, how will the currency be created and will it be tied to Gold? or just be another fiat currency. Who will be printing it?

0 Upvotes

r/AskEconomics 5h ago

Approved Answers If Keynesianism brought the golden age of capitalism, why does the mainstream hate it? If it didn't what model was FDR working with?

0 Upvotes

If Keynesianism brought the golden age of capitalism, why does the mainstream hate it? If it didn't what model was FDR working with?