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Production and interest

Production is every interaction that results in an economic good. Benefits are the achievement of a certain satisfaction with the consumer. So production is really the creation of economic benefits.
A utility is not a material thing but rather a special feeling that a person feels as a result of the acquisition or use of a commodity. This feeling varies from person to person and cannot be considered a feature of a watch.

Value theory in economics

Value and interest.
Economists since ancient times distinguished between two concepts. The first value is the value used, which means the ability of a thing to satisfy a person's need for it. It is a purely personal value.
An example of the benefit of a glass of water for a person who is extremely thirsty is a very large example, and thus has a high utilization value. As for the benefit of a cup of water for those who do not feel thirsty, it is little or no, and thus its value decreases.
Second, exchange value means the ability of an object to exchange something else for what it is paid for to have it.
It is observed that all commodities, whether free or economic, have a use value.
Only economic goods have an exchange value, in contrast to free goods.
It is noted that the value of use is a personal value, and the exchange value is a social value and can only exist in the case of the presence of many individuals and their residence among them.

Value and price

Exchange value involves the idea of ​​comparison or relationship between mutual quantities of two different things.
Thus, the value of good (X) can be expressed by stating the percentage of its exchange with another good (Y).
In modern societies, exchanges take place through money that facilitates exchange, not through the trade-offs that characterized ancient societies.
The swap is split into two separate currencies.
The first is to sell for cash.
The second is buying for cash.
Thus, money is the general and standard measure of the values ​​of things.
- The amount that expresses the value of one unit of the thing is called (the price), so the price of the thing is the monetary expression of its value in the market, and this price can be greater or less than the value.
In our study, we will limit ourselves to the prices of the (free) market economy, that is, the prices determined by the free interaction between supply and demand, not the prices of the planned (socialist) market economy.

Evolution of the theory of value.

Economists had many opinions and interpretations of value until economist Alfred Marshall, who had collected the opinions of economists before him, came out. Marshall explained that the utility-dependent supply and the supply dependent on the costs of production determine between them the value of the commodity and thus the value cannot be fully explained by supply alone or demand alone. It is necessary to combine them.
Main theoretical trends in value interpretation:
There are three main trends economists have in explaining value:
First, the interpretation of value from the supply side, as these economists believe that the value of a commodity is determined by its cost of production.
This theory is called the traditional theory or the objective theory of value.
Within this trend, we can see the existence of two distinct categories.
The category of those who argue that value is determined by the cost of all factors of production, labor, land and capital. This theory is called the theory of value in production costs.
A group of those who say that value is determined by work only is called the theory of value at work.
The second is the interpretation of the value from the demand side only, as they believe that the value of the commodity depends on the amount of its usefulness, and since the utility is a personal or psychological thing, so this trend is called the personal theory of value, but this direction did not take its true intellectual strength until the proponents of this trend were able to Merging the idea of ​​scarcity with the idea of ​​utility into one theory called marginal utility theory.
And the third is the interpretation of value as a result of the interaction of the forces of supply and demand for Jaather. This theory has been subjected to many criticisms in terms of the inability to quantify benefit and the inability to combine objectively specific factors with subjective, subjective factors.