I’ve heard that interest is when someone borrows your money they pay back extra for borrowing it. is this true?
In: Economics
Inflation : Joe of the playground has a rare candy that everyone on the playground wants. So he decided to trade it to get more candy.
Joe trades Sally two normal candies for one of his rare candy. So joe did that until he got 100 candies. At that point Joe dose not have as much need for candy. So he started asking people for five candies for his one rare one.
Now sitting on a pile of 500 candies Joe now dose not see the value in trading 1 rare candy for 5 normal candy. He starts asking the playground for 50 candies for his one rare candy.
Interset: Daniel wants a apple, but dose not have one today. However Steve has danniels favourite type of apple. So Daniel ask Steve to have his Apple. However Steve what’s to keep his apple, so Steve says no. Daniel a crafty kid, said that if Steve give him his Apple today, then Daniel will give him two apples tomorrow. So Steve agreed, but said to Daniel, if he doesn’t give him two apples tomorrow then Steve will want 4 apples the day after.
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