eli5 Why is the end product sugar cheaper than the base ingredients or waste products from it’s production?

Question

eli5 Why is the end product sugar cheaper than the base ingredients or waste products from it’s production?

In: Economics

Answer 1

Imagine you open a lemonade stand on your street. It costs you $2 a jug to make, and a jug gives you 10 cups, so you sell it at 50c a cup to make 30c profit from every cup.

Then the rich bitch Jennie across the street steals your idea, and so does the next 5 neighborhood kids. Everyone starts cutting their price to undercut the next kid, and suddenly you’re selling each cup at 20c or less.

Fuck you Jennie.