wht is free market?

[iraqisax]

The free market is where people buy and sell without government interference. In the free market, prices are determined by the buyer. For example, if I am selling apples, and I am asking $1 apiece for them, I am making an offering. If nobody is buying, I will have to lower my price. Eventually, someone will purchase an apple. That determines the price. it is whatever someone will pay.

It is the same for services. If you are a musician, and you refuse to work for less than $1000 per night, you may or may not get any work. If you try $500 and still get no bites, you have to lower your price. Eventually, your asking price will be accepted (provided you are any good).

Sometimes the buyer will make an offer. Now the seller can agree to that price, or hold out for more money.

Supply and demand refer to what the seller can get, price wise. Supply refers to how many of the item are available. Demand refers to how many people want an item.

What makes a rare coin valuable. The fact that it is rare implies the supply is small. If you try to sell that coin to a group of coin collectors, you will get a better price than if you try to sell it to people on the street. The reason for that is, coin collectors want that coin, and may bid against each other to purchase it. A person on the street may realize that the coin is valuable, but since he is not a collector, he is not interested, unless the price is low.