Wealth of Nations Book 1 Chapter 4

Chapter 4 - Of the Origin and Use of Money

• Trade results in the need to find an easily trade-able good. Metal fits this need; eventually the metal is stamped to certify it. This certification essentially becomes the only thing necessary, resulting in a coin or devaluation of the metal. The is currency.
• Practical Value = the value of an object in use
• Value of Exchange = the purchasing power of an object.
• Practical Value and Value of Exchange correlate inversely