Suppose that 40 people in the Class A income bracket can afford a US$1000 widget while 160 people from Class A & B income bracket can afford US$750 during the pre-crisis market. Assume the crisis causes a 50% drop in affordability across all income brackets. This means only 20 people in Class A can afford US$1000 while 80 people in Class A and B can afford US$750. If the manufacturing cost of the US$1000 widget is just US$500, the total profit is therefore, US$500. If this profit is reduced 50% to US$250 for a total price of US$750, this means that 80 people in both Class A and B can now afford the product which is double pre-crisis levels. This produces a profit of US$250 x 80 or US$20,000 which the same for pre-crisis Class A only sales of US$500 profit x 40 people.
Also, since the demand is doubled from 40 to 80, production requirements is also double which creates more jobs instead of losing them.This is essential for recovery from the crisis. The main drawback is the doubling of capitalization requirements, however this is a one time event. Small Business Financing can help in this. Business Finance is a mainstream method for securing additional capital in any level of business. Small Business Finance loans can be availed to cover increases in production.