ABSTRACT
In these four chapters, Smith deals with prices and values. Money is an instrument of trade that facilitates the exchange of the goods, the consumption of which is what makes us wealthy. Money is thus not wealth; it is not even the best instrument to measure value. Labor is the ultimate measure of value. The value of a good for a buyer is the amount of labor that buying the goods saves. The value for a seller is the amount of labor that can be bought and thus saved from the sale of the good. The price at which we buy and sell needs to include the wages of the workers, the profits of the owners of productive resources, and the rents of the landlords, if all these three factors of production are used. The natural price of a good is its average price. The market price is not necessarily the same as the natural price, but it gravitates around it.
