I shop at a 'used' craft supply store. You can pick up skeins or balls of yarn for 50cents. Is there a way to determine if the yarn is wool and will felt well BEFORE buying?
The methods at this site would NOT be an option in the store: http://www.wikihow.com/Tell-Wool-Yarn-from-Acrylic-Yarn
cute craft that got me thinking http://www.purlbee.com/felted-christmas-trees/
