How can it be that in an economy where every participant strives for their own benefit, there is no chaos, but rather a state that resembles equilibrium? This astonishing question, which Adam Smith answered with the metaphor of the "invisible hand" as a representation of the price mechanism, sparked the beginning of economics. This book analytically and precisely outlines the prerequisites for the functioning of the price mechanism. In a comprehensive model that includes all aspects of an economy in its basic outlines from the outset, the supply and demand sides are gradually detailed, and extensions such as external effects, public goods, and imperfect competition are ultimately addressed. The book provides an important foundation for a micro-founded macroeconomics.