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and Interest in a Many-Product Economy 313
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and Interest in a Many-Product Economy 313
where G may be called the 'cash flow' of day 2—i.e., the excess of receipts (O) over expenditures (W + I) expected to result on day 2 from the investment—and where T measures the useful life of the investment. We can say then that the value of the machine on day 1 (P) together with any other expenditure necessarily incurred with it given expected cash flows (G, G, . . . G) the present value of the investment will be greater the higher are the discount factors interest. But while a reduction in the rate of interest which is expected to be
Edition 1st Edition
First Published 1968
Imprint Routledge
Pages 1
eBook ISBN 9780203106594