Try to imagine poker game.
You and four of your friends decide on a friendly game one evening. Sitting down at the table, you decide on nickel stakes, but nobody has any nickels. Everyone has dollars.
So, upon finding a box of paper-clips, it is agreed that they will serve as tokens in the game. Each paper-clip will represent a nickel.
Everyone buys in for a dollar. Each person receives twenty paper-clips.
The game starts. Round & round it goes. Everyone has had a good time, and it's time to cash out. The paper-clips are gathered, whereupon it is now discovered that someone has sneaked ten paper-clips onto the table during the game. There are now 110 paper-clips representing five dollars.
Question: what has happened to the value of each paper-clip?
That is inflation, ladies and gentlemen.
Very clearly explained.
No comments:
Post a Comment