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To influence appeal of investments into different branches or different methods

Productions.

That at the decision of problems of the given section to exclude any influence of the monetary

Norms of percent, we will admit for a while that during the period interesting us

There is no granting of money on credit: or businessmen Possess the used capital and with them effectively interfere to lend what That was its part, or they are limited by a rigid credit rationing.

We will assume, however, that before a rise in price for the goods rate of return on

The capital in all firms was identical. Excluding from consideration of results

Changes of prices of goods any reasons connected with norm of percent, we While intentionally we distract that becomes our main problem later. Nevertheless this time derivation from the central question will allow us To allocate more simple parts of the proof, still, probably, requiring in To accurate information.

The problem facing to us consists thus in, how at To not changed wages the rise in price for the goods will affect the flowing Distribution of available businessmen of means between Costs for wages (investments into "working capital") and costs On the equipment (investments into "fixed capital"). To avoid

The complexities connected with changes of staple prices, etc. and considered by me in

To other work pp. 29 ff., Interest, Investment and Profits, we have the right

To admit that all firms about which there is a speech, concern type, Presented by brick-works on a limiting ground, where the applied Work makes not only all raw materials, but also fuel.

It is necessary to enter unequivocal and whenever possible a consistent measuring instrument

Proportions in which work and the capital in various firms incorporate and at any

Possible methods of production. For our problem the most convenient measure, to

To the same having that advantage that it is familiar to businessmen, will be

The concept of "rate of turnover" applied either to everything, or to any part

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