Superphysics Superphysics
Chapter 3

The Force of Capital

by Juan
November 3, 2023 2 minutes  • 247 words

The Effort Theory of Value revealed that it is the passion or interest of a person that drives his industry and prompts him to get the skills and abilities to realize that interest.

This same passion pushes us to use our capital or skills, abilities, and assets to produce value for others, otherwise we feel a sense of waste or regret.

In Economics, this manifests as the opportunity cost which is defined as the potential forgone profit from a missed opportunity.

It necessarily leads to the concept of the time value of money which says that a sum of money is worth more now than the same sum will be at a future date, due to its earnings potential in the interim.

This makes us use our money or assets or skills in the way that will create the most impact either by quality or quantity.

This commonly is seen in:

  • the banking and finance industry where deposits and funds must be used quickly in the most profitable way.
  • capital intensive industries getting investments to mass produce products quickly

In everyday life, this manifests as:

  • people with a lot of money lending it out to their friends
  • beautiful or handsome people entering show business where they will be exposed to public who will then appreciate their beauty
  • a landowner opening up his house or land to be leased by strangers
  • a topnotcher graduate at school choosing to work for the most famous companies instead of ordinary ones

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