What is an item worth?

[Kazamoto]

You can only control *your* decision to sell or not. You can't control others. That decision is theirs, and you can't take it from them. You can only deal with it. If the price really *is* lower than the market price (AKA "what the customer is willing to pay"), you can profit from it.

There is nothing here I disagree with, but I think that was intentional. And deal with it we all will, but the point of threads like these are to discuss, and honestly mostly bitch about people who sell items for less than 'what the buyer is willing to pay', AND less than the cost to produce.

The buyer in all of these situations is always willing to pay the least amount he possibly can.
This is a simple fact, no matter what the item is, once someone has decided to buy an item, they will always want the lowest price possible.

Sellers on the other hand should spend a little more time paying attention to demand for products, supply on the market, and cost to produce.

It has buyers at both price points, but there will be *more* buyers at 250 gil. If there are enough buyers at 500 gil to buy the entire supply, then buy the 250 gil and resell it at 500 gil. Free money. What you have here is the concept of the "market clearing price." As the price rises, you'll have more suppliers. As the price falls, you'll have more buyers. Thus, there will be a price at which you have an equal number of suppliers and buyers and the market clears. If people are selling below the market clearing price, you'll be able to buy what they're offering and resell it at a higher price. If you can't do that, then they're not selling below the market clearing price.

And we will still have those that dump goods on the market at that lower cost for a quick sale, causing a chain reaction of price reductions by other sellers, who can change their prices without penalty. To counter this, one or more people would have to constantly camp every sell-able good, to buy and resell.

In another pair of multipage debate threads there were two concepts from the FFXI auction house mentioned that would slow or at least provide a disincentive to this cycle.

FFXI was a blind auction house.
You could not actually see the posted price of an item, this meant while sellers could still sell for what ever they wanted, buyers had to refer to the sales history to find an items value.
The buyer then bid at or around the previous sale prices, or even way below. If a buyer wanted to spend their time to find the absolute minimum price, they could, but in that time, they wouldn't usually change the over all market price that drastically. As the sellers could not see their competitors prices.

FFXI charged the auction house taxes when the item was posted.
Sellers were free to take their items down and relist them, and pay the tax again. This discouraged overpricing items, for fear of having to relist the item, it also discouraged every seller from adjusting their prices down with every undercut or fluctuation.

[Nova_Dresden]

Logic

Completely agree with most of this, but in the grand scheme of things it really comes down to this:

An item is worth what somebody is willing to pay for it. No more, no less.

That's the deciding factor on what I think something should cost. If I'm willing to pay the price set on the item, then it's worth that price. I understand the NPC sell price as well as making a minor profit on the mats+production costs, but if I can price out the items it takes to craft the item in question and the total is less than 5-10% of the asking price then I won't pay it. Tank stuff never really dropped in dungeons for my group, so I tried buying from the AH to patch holes in my outdated gear. What I found was 2-3 weeks after a new game is launched on a new server there were NUMEROUS people pricing a level 20 shield in excess of 150k. Food was 8k each. A weapon for a level 20 Gladiator was equally out of the realm of good logic. The value of the item to the seller was exponentially different than my (the consumer's) value of the item. I decided it just better to outlevel my group, use quest rewards or NPC bought gear, and just level sync down to them instead of paying an exorbitantly ridiculous price for a temporary item.

If what you need is of no use to anyone, it will sit on the AH for a while until someone needs it, or you would be forced to NPC it. At least in FFXI you could Desynth items and get materials back.

Soulbind it and sell the Materia. It may not exactly be desynthing, but it is your option if the item just will not sell.

A can of Arizona Ice Tea is $0.99
If i buy it, or don't, it costs $.99, if it goes unsold and passes its expiration date, it gets tossed out, but it was still worth $.99 until that point.

A can of Arizona Iced Tea is priced at $0.99 to the end consumer. Its cost to the distributor is likely considerably less than that and probably closer to $0.50 or $0.75. Its cost to the end consumer is still $0.99 due to the price being printed on the can itself to prevent overpricing and customer gouging, but if it is tossed out its worth isn't $0.99 it's either $0 or a loss due to the costs of storage/refrigeration.

Fair, but if I bring along 10 friends? 100 compatriots? 500 facebook buddies?

And we all offer $3.50? How many 'what buyers are willing to pay' does it take to lower the value of something?

If last week they were $233,509 and only 4 people bought them, and now 500 want them for $3.50, does this not change what it is worth?

It falls to the supply side of Supply-and-Demand economics. If they make too many of them and the cost to store them is depreciating the item in question then the price may eventually fall. However, in the real world a luxury item like a Ferrari is not an item produced for a mass market and so it is solely produced, marketed, and sold to a select small clientele and its intention to sell to a middle-class citizen is roughly in the region of never.

If sales were being made at 500g, and now someone has undercut to 250g, is it worth 250 or 500? It has buyers at both price points.

If the item is continued to stock at 250g, then the price is currently 250g. If no one continues to stock at 250g and 500g is the lowest price (or some ass buys all the 250g items and relists them) then the price is currently 500g. Consider it a holiday or Black Friday sell where an item is sold at a lower than normal price point, but then returns to the market average.

honestly mostly bitch about people who sell items for less than 'what the buyer is willing to pay', AND less than the cost to produce

A buyer is always willing to pay 0. That's the floor of demand: Free. Reasonably selling something for production costs with a relistic profit is acceptable. Selling something for 25x the cost of production is not. The game is setup where I can level EVERYTHING, and if I don't want to pay your prices I can happily level EVERYTHING and never have to pay you anything. Other MMOs had limitations to crafting professions requiring some sort of outside sourcing for materials, but that's not an issue in this game. Everyone can supply everything for themselves, and at some point in the future of this game everyone may effectively never need to buy from someone else.