The mistake you are making in your logic is that you have the elements correct, but the order wrong.
The FIRST determination is price and performance (not price per performance) and if that test is met, then the next question becomes, "is supply adequate?"
If, presently, Intel has bettered AMD in price and performance, then price reduction is necessary to create a demand, not with the primary goal of factory capacity but of reduction of present innovatory glut.
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