Economics 101 – The Magic of Cash Flow
A Man went to an inn in a small village. He passed the Inn Keeper $1000 to check in.
While he is walking up the stairs to check out his room,
The Inn Keeper immediately left to pay the Pork Seller the $1k he owed for the pork;
The Pork Seller return $1k to the Farmer for the pig;
The Farmer went to pay up the $1k he owed to the Feed Supplier;
The Feed Supplier returned the $1k to the Prostitute he called last night;
The Prostitute quickly went to pay up the room rental to the Inn Keeper;
So the $1k is back with the Inn Keeper.
The man came back down and said he didn’t like the room, took the refund and left. However the entire village debts were cleared in that short while.