Monday, November 8, 2010

Economics 101

Gabrielle has asked before (usually after she has been told that money doesn't grow on trees) why "they" can't just print more money. I tried my best to explain the principals of supply and demand. And that if "they" printed more money, then everyone's money would be worth less. And that just printing more money is called counterfeiting, and it's illegal.



As an example, I tried using 10 gold coins in the entire school (1,050 kids). Kids would be willing to give or trade, alot of something to have one of the gold coins. But if there were 10,000 gold coins in the school, they wouldn't be as rare and it would be no big deal if you had a gold coin, because everyone would have several gold coins.



Tyler: "Yeah, like when I get the best Silly Bands for my mozzarella cheese."

Mom: "You trade your lunch for Silly Bands?"

Tyler, sheepish grin: "Yeah! I got three Bands for just one piece!"

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