Price: Difference between revisions
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[[Trade|Exchanges]] happen only if each party values what they receive more than what they give away. The '''price''' is the exchange ratio between the goods: if Alice trades Bob 4 apples for an orange, the price of an orange is 4 apples. Inversely, the price of an apple is 1/4 oranges. The exchange ratios are now as a rule [[money]] prices.<ref name="Mises_prices">Ludwig von Mises. [http://mises.org/humanaction/chap16sec1.asp "1. The Pricing Process"], ''[[Human Action]]'', online edition, Chapter XVI. Prices, [[Mises Institute]]. Referenced 2009-05-11}.</ref> | [[Trade|Exchanges]] happen only if each party values what they receive more than what they give away. The '''price''' is the exchange ratio between the goods: if Alice trades Bob 4 apples for an orange, the price of an orange is 4 apples. Inversely, the price of an apple is 1/4 oranges. The exchange ratios are now as a rule [[money]] prices.<ref name="Mises_prices">Ludwig von Mises. [http://mises.org/humanaction/chap16sec1.asp "1. The Pricing Process"], ''[[Human Action]]'', online edition, Chapter XVI. Prices, [[Mises Institute]]. Referenced 2009-05-11}.</ref><ref name="Rothbard_medium">Murray N. Rothbard [http://mises.org/rothbard/mes/chap2b.asp "4. Terms of Exchange"] Chapter 2 - Direct exchange, ''[[Man, Economy and State]]'', online edition, referenced 2009-05-05. "The price of a good in terms of another is the amount of the other good divided by the amount of the first good in the exchange."</ref> | ||
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==Money prices== | |||
==References== | ==References== | ||
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* [http://mises.org/humanaction/chap16sec1.asp The Pricing Process], [[Human Action]] | * [http://mises.org/humanaction/chap16sec1.asp The Pricing Process], [[Human Action]] | ||
* [http://mises.org/rothbard/mes/chap4a.asp 1. Money Prices], [[Man, Economy and State]] | * [http://mises.org/rothbard/mes/chap4a.asp 1. Money Prices], [[Man, Economy and State]] | ||
* [http://www.econlib.org/library/Enc/PriceControls.html Price controls] | |||
Revision as of 23:17, 10 May 2009
Exchanges happen only if each party values what they receive more than what they give away. The price is the exchange ratio between the goods: if Alice trades Bob 4 apples for an orange, the price of an orange is 4 apples. Inversely, the price of an apple is 1/4 oranges. The exchange ratios are now as a rule money prices.[1][2]
Money prices
References
- ↑ Ludwig von Mises. "1. The Pricing Process", Human Action, online edition, Chapter XVI. Prices, Mises Institute. Referenced 2009-05-11}.
- ↑ Murray N. Rothbard "4. Terms of Exchange" Chapter 2 - Direct exchange, Man, Economy and State, online edition, referenced 2009-05-05. "The price of a good in terms of another is the amount of the other good divided by the amount of the first good in the exchange."
See also
- The Wikipedia page on price
- The Pricing Process, Human Action
- 1. Money Prices, Man, Economy and State
- Price controls