_Def. 38._ I have used the word _elementary_, in order to show that money-costs are not meant. On account of the doubt which may arise in this respect when the term _costs of production_ is used alone, and the further doubt, whether ordinary profits are always included, I am decidedly of opinion that _the conditions of the supply_ is a more expressive and less uncertain term for the same meaning. I do not find, however, that generally it is so well understood. I have defined, therefore, _the costs of production_ with the addition of the word _elementary_, and including profits, as having precisely the same meaning as the conditions of the supply. I once thought it might be better not to include profits in costs of production; but as Adam Smith has included them, and more particularly as the profits worked up in the capital necessary to any production must form a part of the advances or _costs_ in any sense in which the word costs can be used, I think it best, on the whole, to include necessary profits in the elementary costs of production. They are obviously included in the necessary conditions of the supply. _Defs. 39 and 40._ In speaking, of the quantity of labour for which a commodity will exchange, as a measure either of the conditions of its supply or of its value, it must always be understood, that the different kinds of labour which may have been employed to produce it, must be reduced to labour of one description and of the lowest denomination, namely, common agricultural day-labour, estimated on an average throughout the year. This is the kind of labour which is always referred to when labour is spoken of as a measure. _Def. 57._ It is not true, as stated by M. Say, that prices rise in the direct ratio of the _quantity_ demanded, and the inverse ratio of the _quantity_ supplied.[99] They only vary in this way, when the demand is understood to mean the sacrifice which the demanders are able and willing to make, in order to supply themselves with what they want; which may be represented in regard to price by the quantity of money ready to be employed in purchases in a market. When the demand for _labour_ is spoken of, it can only relate to _extent_; and a greater demand can only signify a power of commanding a greater _quantity_ of labour.