Class summary 12/9

Insurance company and doctors make profits from our sickness

Clothing factory makes profits not by make us naked, but by make clothes on us

People in nursing and medical center will not show up if they are not paid

The belief in your work motivates you, also the money you will get paid from the work

The possibility of making money is completely misguided

Land: a. Explicit (rent)   b. Implicit(rent)

Labor: a. Explicit (wage)    b. Implicit(wage)

Capital: a. Explicit (rent)   b. Implicit (rent)

What is the cost of poverty?  Your inability to produce something people value

EWOT: compare expected benefits and expected cost

Profitability rate = rental rate + appreciation rate + Interest rate

Price = $ 32,000

Lease = $1,000/mo for 12mo

Expected car to sell for $24 next year

Annual Rates / Price = 37.5%

I will 37.5% richer each year if I lease a car

If a person give a $ 100 million building as a gift, it actually makes the university poorer, because the school need to spend maintenance fee every yea.