Read the economy. Manage your money.

Start with a doubt

Why are we here? Why economics? Does it even make sense to study something that sounds like it belongs to bankers and finance ministers?

Let me ask you a question first. Is economics about money? Partly. Mostly it is about choices.

You have ₹100. You want a book, and you want a cinema ticket with a friend. You can buy one. Say you choose the book. What did the book cost you? ₹100? That is the price tag. What you really gave up is the evening with your friend. That evening is the real price of the book.

Economists call it opportunity cost: the cost of anything is the best thing you give up to get it. A family choosing between a new phone and a school trip faces it. So does a government choosing between a new road and a new hospital. Home and nation, the same question.

Look at a packet of chips

Pick up a packet of chips. The price on it may be the same as last year. Now look at the weight. Is it the same? Often it is not. The packet is lighter, and the price has not moved.

Somebody made a choice there too. Who? And why would a company rather sell you less than charge you more? By the end of chapter 3 you will know. That is the kind of question this course is built on: small things you see every day, and the big ideas behind them.

What do you think already?

Three quick questions before we begin. There is no score, and your answers stay on this device. Answer with your gut; at the end of the course you will see your first answers next to what you know by then.

How this course works

Four parts and 25 chapters, then a wrap-up, about 11 hours, at your own pace. Each chapter has:

• in most chapters, a story, something to try and a question to argue about,
• an "In short" box at the top, so you can see the main points before you read,
• a note for your notebook at the end, and
• a five-question check. Pass it with 4 right, as often as you need.

Pass every chapter check and the final round, and you get a certificate of completion with your name on it and a link anyone can use to check it.

The course ends with a question of your own: you choose one to write on, and you can draft it in the Writing Studio. Publication depends on review and is not guaranteed.

One rule for the whole course: questions are more important than answers. If something does not make sense, that is not a failure. That is where learning starts.

Explore in World 101

Each part of this course connects to World 101, Learnacy's map of what the world knows. Before you start, open one of these subjects and look around for five minutes. Note one question that catches you: it may become the question you write on at the end of the course.

• Money, Banking and Credit
• Central Banks and Monetary Policy
• Inflation, Deflation and the Business Cycle
• Cryptocurrency and Digital Money

The potter, the farmer and the weaver

Picture a village market with no money. You are a potter, and you want cloth for a new shirt. You find the weaver. Does he want a pot? No. He wants wheat. So you find the wheat farmer. She wants a pot, but all she has is wheat, and you do not want wheat. Round and round you go, carrying your pots, while the cloth gets sold to someone else.

Economists call this the problem of the double coincidence of wants: to swap, you must find someone who has what you want and wants what you have, at the same moment. In a market of three people it is hard. In a country of a billion people it is impossible. Money solves it. You sell your pot to anyone who wants a pot, and buy cloth from anyone who sells cloth.

Three jobs, one note

So what is money? Define it by what it does. Money does three jobs.

• A medium of exchange. People accept it for almost anything.
• A unit of account. You can put a price on anything in it, so you can compare a pot with a shirt.
• A store of value. It keeps its worth until you spend it next week, or next year.

Anything that does all three well can be money. Anything that fails one job struggles. Is a cricket card money? It might be a store of value, but try buying rice with it. Now test your instinct.

Game: is it money?

Decide for each one, then see which of the three jobs it actually does.

The six properties of good money

Anything that wants to be money has to pass these tests.

Explore in World 101

Money is one thread in a much bigger story: banks, credit and trust. Open Money, Banking and Credit in World 101 and follow one link that surprises you.