econ 201 ch 13
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why does production require savings?
because both direct and roundabout production take time- time during which goods and services are not available from current production
positive rate of time preference
- consumers value present consumption more than future consumption
- consumer is willing to pay more now that wait
interest per year as a percentage of the amount saved or borrowed
marginal rate of return on investment
the marginal revenue product of capital expressed as a percentage of its marginal cost
an intangible asset created by human knowledge and ideas
the value today of income to be received in the future
converting future dollar amounts into present value
a given sum of money received each year for a specified number of years
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