SOCB42H3 Lecture : Lecture 3
Document Summary
Propensity to trade markets sol skilled labour national wealth commercial. Propensity to better condition saving capital accumulation higher proportion of productive workers national wealth commercial society. Why does money exist: limits of barter, bartering is very restricted. each party must have something the other wants: money is whatever everybody wants (could be anything, e. g. salt, cows, etc. ) What good substitution to serve as money: a) lasts (non-perishable, use value vs. exchange, divisible, use value: whatever you do with it for personal use, exchange value: use to get something else (trade) Natural price: however much it costs to bring something to the market to sell (wages, rents, normal profit) Market price: however much you actually sell something for. Law of demand: there is an inverse relationship b/w the price of a good and amount of buyers willing to purchase (the higher the price, the less willing one is to purchase)
