2. Real and Nominal Price of Commodities, or of Their Price in
Labour, and Their Price in Money
• “Real" value because it's connected to the real needs
of human life, while money value can change with
taste and fashion over time.
• The nominal value is the amount of money you pay for
it. Calculations including interest payments, market
values, discounts, premiums and yields.
• people are only rich or poor depending on how much
stuff they can afford to buy.
• All value is connected to human work.
3. Component Parts of the Price of
Commodities(I)
• when private property gets invented, some
people start charging other people rent to live
on their land or in their buildings. And that's
when you get landlords.
4. Component Parts of the Price of
Commodities(II)
There are three things that make up the price of
every product:
Labor it took to make the product
Profit that the company wants to make.
Rent that the company gets charged on its
buildings or its machines.
• When you look at the big picture, the wealth of a
country can also be broken into labor, profit, and
rent.
