esi 
Ts 
  
  
     
3 
304 NATURE OF CAPITAL AND INCOME [Cuar. XVII 
curves; so that the total capital-value at the time C is 
represented by the altitude BC. 
But this separate representation for capital and for in- 
come respectively need not be adhered to, because the 
capital curve AB alone contains in its vertical teeth all 
that is necessary to indicate the installments of income; and 
in the present chapter the main propositions relating to 
a al a' a 
  
  
  
C A 
Fie. 13. 
capital and income will be restated with the aid of geo- 
metrical representations of which this capital curve AB 
is the type. 
§2 
First of all, such a curve exhibits the fact that the value 
of any capital is the discounted value of the expected in- 
come. In Figure 14 the several discount curves used in 
previous diagrams are all continued to meet CB. The 
parts into which CB is thus divided, b, b', b”, b""', will 
represent respectively the present values of the income 
items a, a’, o//, a'"’. This may readily be proved from 
the nature of the discount curves.