Authors libby rittenberg 707
Bạn đang xem bản rút gọn của tài liệu. Xem và tải ngay bản đầy đủ của tài liệu tại đây (514.43 KB, 1 trang )
KEY TAKEAWAYS
The net present value (NPV) of an investment project is equal to the
present value of its expected revenues minus the present value of its
expected costs. Firms will want to undertake those investments for
which the NPV is greater than or equal to zero.
The demand curve for capital shows that firms demand a greater
quantity of capital at lower interest rates. Among the forces that can
shift the demand curve for capital are changes in expectations,
changes in technology, changes in the demands for goods and
services, changes in relative factor prices, and changes in tax policy.
The interest rate is determined in the market for loanable funds. The
demand curve for loanable funds has a negative slope; the supply
curve has a positive slope.
Changes in the demand for capital affect the loanable funds market,
and changes in the loanable funds market affect the quantity of
capital demanded.
TRY IT!
Suppose that baby boomers become increasingly concerned about
whether or not the government will really have the funds to make
Social Security payments to them over their retirement years. As a
result, they boost saving now. How would their decisions affect the
market for loanable funds and the demand curve for capital?
Case in Point: The Net Present Value of an
MBA
An investment in human capital differs little from an investment in
capital—one acquires an asset that will produce additional income over
Attributed to Libby Rittenberg and Timothy Tregarthen
Saylor URL: />
Saylor.org
707
