Das Hotel- und Gastgewerbe

The nature of capital and income

Bibliographic data

Monograph

Identifikator:: 1774764512

URN:: urn:nbn:de:zbw-retromon-160421

Document type:: Monograph

Author:: Nitsch, Harry http://d-nb.info/gnd/117023272

Title:: Das Hotel- und Gastgewerbe

Place of publication:: Düsseldorf

Publisher:: Floeder

Year of publication:: 1928

Scope:: 804 Seiten; Ill.

Digitisation:: 2021

Collection:: Economics Books

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Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: 80. Der Propagandawert von Kongressen und Ausstellungen

Collection:: Economics Books

Sec. 4] EARNINGS AND INCOME 231 of any future income — or, at least, the expectation that there would be an expectation of it — there could be no capital-value. ~ Capital-value, independent of expected in- come, is impossible. § 4 The first proposition to be emphasized as to the rate of value-return is that it is not necessarily equal to the rate of interest, but may be either greater or less than that rate, and to any degree. Let us take, for example, the case of the house which we assumed would endure just fifty years, giving throughout that period a shelter-service worth, after actual expenses are deducted, $1000 annually. We saw that its value, computed by discounting this fifty-year annuity on a 5 per cent basis, is $18,300. It therefore yields the first year a rate of value-return on its capital-value of 3%, or 5.4 per cent. At the end of ten years its value, found by dis- counting the income still remaining, will be $17,200. It will therefore then be yielding a value-return of 7%; per year, or 5.8 per cent. At the end of thirty years, in like manner, it will be worth $12,500 and yielding 3%, or 8 per cent. Again, the suit of clothes which will last two years, and gives services worth $20 the first year and $10 the second, has a value at the start of about $28, and at the end of the first year of about $9.50. The value-return the first year is therefore 2, or 71.4 per cent, and the second year Jo or over 100 per cent. The loaf of bread has a value of 10 cents. It yields 10 cents’ worth of income in a day, which is at the rate of $36.50 per year; consequently its value-return is #2 or a rate of 36,500 per cent per annum (interest reckoned daily or continuously”). In these examples the value-return exceeds the rate of interest. Reversely, it is possible for the value-return on capital to be less than the rate of interest. If, for in- stance, forest land with small trees is bought, it may be

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