Company A has a profit of four cents per widget and Company B of one cent. Now let us suppose that costs remain the same but a temporary extra demand for widgets pushes up the price to twelve cents, with both companies remaining the same size. The strong company has increased profits from four cents per widget to six cents, a gain of 50 percent, but the high-cost company has made a 300 percent profit gain, or tripled its profits. This is why, short-range, the high-cost company sometimes goes up more in a boom and also why, a few years later, when hard times come and widgets fall back to eight
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