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above publisher of this book. Published in Great Britain by. Dorling Kindersley Limited. A catalog record for this book is available from the Library of Congress. PUBLISHING DIRECTOR DTP DESIGNERS A catalog record for this book is For details, contact: DK Publishing Ben Marcus David John Special Markets, . The Economics Book: Big Ideas Simply Explained [PDF] Book details Author: DK Pages: pages Publisher: DK Publishing (Dorling.
Big ideas make great business thinkers and leaders. The Tiwa tribal people of Assam, India, exchange goods through barter during the Jonbeel Mela, an age-old festival to preserve harmony and brotherhood between tribes. And when we seem to be at the mercy of risk-taking banks and big corporations, do we know how they came to be so powerful or understand the reasons for their original and continued existence? Set up a giveaway. It remains to be seen how the world economy will resolve its problems, but, armed with the principles of economics outlined in this book, you will see how we got into the present situation, and perhaps begin to see a way out. I n economics one can think small—microeconomics—or one can think as large as the entire system:
Paperback Verified Purchase. This is a good book that presents ideas clearly and concisely. However, it is dangerous for those with minimal understanding of economics. It leads to misunderstanding or assumptions about how economics is studied. If you purchase this book and want to be able to intelligently discuss one of the ideas, I highly recommend additional research.
If you are just looking for exposure to the major ideas for better understanding, then this is a great book for you. I read a lot of both fiction and non-fiction book and this was definitely among the most enjoyable, clear and nicely constructed book I could've hoped for, on this subject. The book is constructed as a quick visit into all the core or most important concepts, each occupying one, two or three pages, with illustration and a small bio of the main figure behind the concept.
I felt like I was in college again. Simply put this book was a masterpiece!!! Fundamental knowledge!! This book is highly informative! Not just for kids.
I have been reading it as well and love it! See all 89 reviews. Amazon Giveaway allows you to run promotional giveaways in order to create buzz, reward your audience, and attract new followers and customers. Learn more about Amazon Giveaway. This item: Set up a giveaway.
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AmazonGlobal Ship Orders Internationally. Amazon Inspire Digital Educational Resources. Views Total views. Actions Shares. Embeds 0 No embeds. No notes for slide. Book details Author: DK Pages: English ISBN Description this book From Aristotle and Thomas Aquinas, to Adam Smith and John Maynard Keynes, to the top economic thought leaders of today, "The Economics Book" is the essential reference for students and anyone else with an interest in how economies work.
Easy- to-follow graphics, succinct quotations, and thoroughly accessible text throw light on the applications of economics, making them relatable through everyday examples and concerns. If you want to download this book, click link in the last page 5. Download Free The Economics Book: You just clipped your first slide!
Clipping is a handy way to collect important slides you want to go back to later. Now customize the name of a clipboard to store your clips. Merchants who appear to be overcharging are simply pushing the price to its limits. But there is a moral dimension too. In , William le Bole of London was punished for selling underweight bread by being dragged through the streets.
Market economists consider the marketplace to be the only way to establish price, as nothing—not even gold— has an intrinsic value. For Aquinas, a scholar monk, price was a deeply moral issue. This just price is simply the price the buyer freely agrees to pay, given honest information. The vendor is not obliged to make the buyer aware of facts that might lower the price in the future, such as the shiploads of cheap spice due to dock shortly.
Free market economists, who reject interference in the market, and those who advocate government intervention—whether for moral or economic reasons—continue to argue about the rights and wrongs of imposing restrictions on pricing.
Thomas Aquinas St. Thomas Aquinas was one of the greatest scholars of the Middle Ages. At the age of 17 he decided to leave worldly wealth behind and join an order of poor Dominican monks. His family was so shocked that they kidnapped him on his way to join the order and held him captive for two years.
His determination, however, remained unbroken, and eventually the family gave in, letting him go to Paris, where he came under the tutelage of the scholar monk Albert the Great — Aquinas studied and taught in France and Italy, and in , founded a studium generale a type of university in Naples, Italy.
I n many parts of the world people are increasingly moving towards a cashless society in which goods are bought with credit cards, electronic transfers, and mobile-phone chips. But dispensing with cash does not mean that money is not used. Money remains at the heart of all our transactions. The disturbing effects of money are well known, inciting everything from miserliness to crime and warfare. Money has been used as a tribute sign of respect , in religious rites, and for ornamentation.
Money lends status and power to individuals, families, and nations. The Tiwa tribal people of Assam, India, exchange goods through barter during the Jonbeel Mela, an age-old festival to preserve harmony and brotherhood between tribes.
A barter economy Without money, people could only barter. Many of us barter to a small extent, when we return favors. Yet it is hard to imagine these personal exchanges working on a larger scale.
What would happen if you wanted a loaf of bread and all you had to trade was your new car? Barter depends on the double coincidence of wants, where not only does the other person happen to have what I want, but I also have what he wants. Money solves all these problems. The seller can then take the money and buy from someone else. Money also gives a yardstick for deciding the value of things.
If all goods have a monetary value, we can know and compare every cost. Different kinds of money There are two kinds of money: In theory dollars issued by the US Federal Reserve could be exchanged for their gold value.
Since , the value of a dollar has no longer been convertible to gold and is set entirely by the US Treasury, without reference to its gold reserves.
With money a seller can sell to anyone who wants what the seller has. Shelling out Wampum were strings of white and black shell beads treasured by the indigenous North Americans of the Eastern Woodland tribes. Before the European settlers arrived in the 15th century, wampum was used mainly for ceremonial purposes.
People might exchange wampum to record an agreement or to pay tribute. Its value came from the immense skill involved in making it, and in its ceremonial associations. When Europeans arrived, their tools revolutionized wampum making, and Dutch colonizers mass-produced the beads by the million. Soon, they were using wampum to trade and buy things from the native peoples, who had no interest in coins, but valued wampum.
Wampum soon became a currency with an accepted exchange rate. In New York eight white or four black wampum equaled one stuiver a Dutch coin of the time. The use and value of wampum diminished in the s.
Money can be held until the time is right to buy. Money helps us measure the value of things. This Shawnee shoulder bag is decorated with wampum beads, which developed into a currency for some North American tribes. H umans have long engaged in borrowing and lending. There is evidence that these activities took place 5, years ago in Mesopotamia presentday Iraq at the very dawn of civilization.
But modern banking systems did not emerge until the 14th century in northern Italy. The peninsula was ideally located for trade between Asia, Africa, and the emerging nations Wealth began to accumulate, especially in Venice and Florence. Venice relied on sea power: It differed from existing banks in three ways. First, it grew to a great size.
Second, its network was decentralized. Dealings in money cash investments are suitable for economies of scale. Use your wealth to found a bank. Gather deposits and keep enough cash to cover withdrawals. Lend wisely, and monitor your loans. Spread your risks across different investments. Make money from money. Another might want a loan—which is riskier for the bank and may tie up money for a longer time.
So the bank came to stand between the two needs: This risk is a calculated one, and the advantage of the system is that it usefully connects savers and borrowers. Financing long-distance trade was a high-risk business in 14th-century Europe. The seller of the goods could also sell the bill immediately to raise money. Italian merchant banks became particularly skilled at dealing in these bills, creating an international market for money.
By buying the bill of exchange, a bank was taking on the risk that the buyer of the goods would not pay up. It was therefore essential for the bank to know who was likely to pay up and who was not. The borrowers least likely to repay are the ones most likely to ask for loans; and once they have received a loan, there are temptations not to repay. Geographical clusters Banks often cluster together in the same place to maximize information and skill.
Leverage, or borrowed money, lay at the heart of the crisis. In , the proportion was often 95—99 percent. However, they led to poor lending standards by two groups: These are the issues faced by all banks since the Medicis: Florence was one such cluster. The City of London, with its goldsmiths and shipping experts, became another. Today, the internet creates new ways of clustering online.
The form a bank takes can also address information problems. Because the members of these organizations checked up on each other, and the managers had good local knowledge, they could provide the long-term loans that their customers needed.
In some countries, such as Germany, they thrived. However, clustering can also lead to risky competition and crowdlike behavior. Bad news can lead to panics. Bank failures can have severe consequences for other banks, and for government and society, as witnessed in the failure of Creditanstalt Bank in Austria in , which led to a run on the German mark, UK sterling, and then the US dollar, triggering further bank runs and contributing to the Great Depression.
As a result banks need to be regulated, and most countries have strict rules about who can form a bank, the information they must disclose, and the scope of their business activities. Stock exchanges connect these needs directly, through equities shares conferring ownership of a company , bonds lending that can be traded , or other instruments. These exchanges are either physical places, such as the New York Stock Exchange, or regulated markets where trading takes place through phone calls and computers, like the international bond market.
The clustering created by exchanges makes these long-term investments more liquid: Savings can also be pooled to lower transaction costs and diversify risks. Mutual funds, pension funds, and insurance companies all perform this role. I n 16th-century Europe prices were rising inexplicably.
This was true. In , Bodin published his Response to the Paradoxes of Malestroit. The French economist Jean de Malestroit? He argued that an If more money is put into the system… … leading to price rises. These precious metals were entering Spain from its new colonies in the Americas and then spreading throughout Europe. Later economists concluded that prices in Europe quadrupled during the 16th century, at the same time as the amount of physical silver and gold circulating in the system tripled; Bodin had estimated the increase in precious metals at more than 2.
He was educated in Paris, and went on to study at the University of Toulouse. Bodin believed in tolerance, but in Laon was forced to declare for the Catholic cause, until the victorious Protestant King, Henry IV, took control of the city. Bodin died of the plague, aged 66, in Money will be neutral in its effect on the real, relative value of goods and services—for example, on how many jackets can be bought for the price of a computer.
The reasoning behind this theory is partly based on common sense. Why is the price of a cup of coffee in a rich part of town so much higher than in a poor area? The answer is that customers in the rich part have more money to spend. But goods and services are always in limited supply, so there will be too much money chasing too few goods, and prices will rise.
This chain of events shows the important relationship between the quantity of money in an economy and the general price level. The quantity theory of money states that a doubling of the supply of money will result in a doubling in the value of transactions or income or expenditure.
They came to recognize that there is a distinct separation between the real side of the economy and the nominal, or money, side. This is why economists focus on real prices—on what quantity of a thing jackets, computers, or time spent working has to be given up in return for another kind of thing, no matter what the nominal price is. Money circulation 25 20 15 10 The abundance of gold and silver… is greater in this kingdom today than it has been in the last years.
If there is an increase in the amount of money in circulation, the bag gets heavier, and the price of goods rises and moves to the right, balancing the scale. Steep price rises in the 15th century led to much hardship among the poor, a rise in vagrancy, and peasant revolts. Transactions is the total value of transactions occurring annually. This equation becomes a theory when we make assumptions about the relationships between the letters, which economists do in three ways.
First, V, the velocity of money, is assumed to be constant, since the way in which we use money is part of habit and custom and does not change much from year to year our washing machine drum spins at a steady rate. This is the key assumption behind the quantity theory of money. Combined with the difference between nominal and real, the quantity theory of money has led to the notion that money is neutral in its effect on the economy. Challenge and restatement But is money really neutral? Few believe that it is neutral in the short run.
The immediate effect of more money in the pocket is for it to be spent on real goods and services. John Maynard Keynes p. Evidence also suggests that money velocity V is not constant. Keynes had other ideas that challenged the quantity theory of money. Keynesian economists argue that these motives are affected less by income or transactions PT in the formula than by interest rates.
A rise in the interest rate will lead to a rise in the velocity of money.