The last Nobel Prize: how money works

The prize for economics went to Robert Hall and Michael Woodford, from America. Economics is the study of how people and countries make, buy, sell and share things.

They studied how the choices of millions of people and shops add up across a whole country. Their ideas help a country’s main bank keep prices steady, so that a packet of biscuits doesn’t suddenly cost much more next month.

A price is how much money you pay for something. If lots of people want something and there isn’t much of it, the price often goes up. If there is lots of it and fewer people want it, the price often goes down.