What Can You Buy With a Dollar?
If you have a dollar today, you can buy one candy bar because most candy bars cost around a dollar. But if you could time-travel with your dollar back to 1950, you could buy 20 candy bars! In other words, each candy bar would only cost you around 5 cents.

It might sound pretty great to get a candy bar for 5 cents, but remember that everything else was adjusted to match. So jobs paid a lot less back then. As of today, if you have a job you have to get paid at least $7.25 per hour - that’s the current minimum wage which has been that amount since 2009. But in 1950, your employer could pay you only 75 cents per hour! So, your candy might be cheaper, but you’d also make less money to pay for it.

Between 1950 and now, the price of almost everything has gone up, and it will probably keep going up in the future. Right now, $1 can buy a candy bar, but in 100 years, you might need $5 or $10 for that same candy bar. In other words, you could say that the same amount of money is less valuable.

This is called inflation. Inflation is the steady increase in prices over time. Inflation doesn’t always happen, but it’s very common.

QUESTIONS

Now let’s see what you recall about cryptocurrency before we get to Bitcoin. Answer the following questions in the space at the left to test your knowledge!

1. “Crypto” is short for:
   a. photography
   b. cryptography
   c. cryptomania
2. Cryptography is:
   a. encoding information so only authorized people can read it.
   b. taking photos of information.
   c. spending lots of Bitcoins.
3. Currency is
   a. staying current with the news.
   b. buying Bitcoins really fast.
   c. system of money in general use in a country.
4. Cryptocurrency is
   a. not something you can hold in your hand or withdraw from a bank.
   b. digital currency where encryption is used to control the creation of currency.
   c. only a unique string of letters and numbers stored digitally.
   d. only available digitally.
   e. All of the above
5. TRUE or FALSE: Inflationary means that the VALUE of money GOES DOWN over time so you can’t buy as much with the same money as before.
6. TRUE or FALSE: Deflationary means that the VALUE of money GOES UP over time so you can buy more with the same money as before.