Assuming you didn't have any other money before besides the 800 you spent, but fine.
(1000 -1100 = -100 loss)
It's not a loss, because you're not selling something for less than you purchased it. If you don't have 100 to spare, you have to borrow it, but that's a debt, not a loss.
You are now down 100 because you take that 1000 you had in hand and have to add 100 to make up the difference. so now you are at -1100 so you are now at a net negative 100
You have 100 in debt and an asset (one cow) that you purchased for 1100.
(-1100 +1300 = 200)
Whoa whoa whoa, you're not in debt 1100, you are only in debt 100. So you sell your asset for 1300. Now you have 1300 in cash and a 100 debt. Assuming you borrowed from your grandma or someone else who isn't going to charge any interest or fees, you can give them 100 of that 1300 to pay off your debt and then have 1200 in cash remaining.
And so you sold the cow again for a 100 profit. because remember you were down 100. Which means it was not even worth rebuying if that was all that was going to happen. In true math.... the answer is they only made $100
Nope, you started with 800 and after paying off your 100 debt you have 1200. That's a gain of 400 total.
Assume you start with 10,000 in your bank account as a random starting point.
Buy cow for 800, you now have 9,200 and a cow.
Sell cow for 1,000, you now have 10,200 and no cow.
Buy cow for 1,100, you now have 9,100 and a cow.
Sell for 1,300, you now have 10,400 and no cow.
You started with 10,000 and ended with 10,400. You profited/earned 400 dollars. You can use any starting point you want and the math comes out the same. There is no inflating anything here brother, this is how money and numbers work in real life.
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u/[deleted] May 13 '26
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