Search results
Results From The WOW.Com Content Network
The term “marginal efficiency of capital” was introduced by John Maynard Keynes in his General Theory, and defined as “the rate of discount which would make the present value of the series of annuities given by the returns expected from the capital asset during its life just equal its supply price”.
The 'marginal efficiency of capital' is defined as the annual revenue which is expected to be yielded by an extra increment of capital as a proportion of its cost. The 'schedule of the marginal efficiency of capital' is the function which, for any rate of interest r, gives us the level of investment which will take place if all opportunities ...
The Incremental Capital-Output Ratio (ICOR) is the ratio of investment to growth which is equal to the reciprocal of the marginal product of capital. The higher the ICOR, the lower the productivity of capital or the marginal efficiency of capital. The ICOR can be thought of as a measure of the inefficiency with which capital is used. In most ...
The horizontal blue line I (r ) is the schedule of the marginal efficiency of capital whose value is independent of Y. The schedule of the marginal efficiency of capital is dependent on the interest rate, specifically the interest rate cost of a new investment.
(In Chapter 14 he usually refers to the schedule of the marginal efficiency of capital as the 'investment demand-schedule'.) A single such curve X 2 X 2 ' is drawn in blue on the right. He begins the discussion by considering a given rate of interest r 1, and then postulates that 'the investment demand-schedule shifts from X 1 X 1 ' to X 2 X 2 '.
Solutions to the problem of this sub-model generally show that the rate of return on health capital must equal the opportunity cost of said capital. Thus, increases in the depreciation rate over time cause the optimal stock of health to decrease. If the marginal efficiency of capital curve is inelastic, gross investment grows over time.
IOWA CITY, Iowa, Jan. 23, 2025 (GLOBE NEWSWIRE) -- MidWestOne Financial Group, Inc. (Nasdaq: MOFG) (“we”, “our”, or the "Company”) today reported results ...
Keynes isolates user cost as a separate component, identifying it as "the marginal disinvestment in equipment due to the production of marginal output". [20] His point (5), which may be considered a technical detail, is that user cost is unlikely to move in exact parallel with wages.