1. The marginal productivity theory, 630. — Complete analysis required, 632.—The impatience theory, 633.— Position here taken, 634.— 2. Marginal productivity of waiting keeps interest rate up by acting on demand for present goods, 635. — Action is direct and not merely through effect on impatience, 636. — Comparison emphasized is not between present and future goods, but between greater and less amount of future, 637. — Fisher's criticism of Böhm-Bawerk criticized, 638. — 3. Marginal productivity of waiting keeps interest rate up by acting on the supply of present goods, 640. — Increased marginal productivity of waiting means higher interest, 642. — Basis of capital valuation, 644. — Distinction between land and made capital, 644. — Rate of interest and rate of impatience in part joint effects of rate of productivity of waiting, 645. — 4. Marginal productivity of waiting by acting both on demand for and supply of present goods, keeps the rate of interest from exceeding this rate of productivity, 646. — As rates of impatience and interest are both influenced by productivity of waiting, so rates of interest and marginal productivity are both influenced by impatience, 648. — 5. Recapitulation, 649.

Journal Article Commercial Banking and the Rate of Interest Get access Harry G. Brown Harry G. Brown Yale University Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 24, Issue 4, August 1910, Pages 743–749, https://doi.org/10.2307/1883494 Published: 01 August 1910

Reductions in prices made only to increase sales, 626.—Absolute and relative responsiveness of sales, 627.—Factors determining the absolute responsiveness of sales, 628.—Absolute and relative responsiveness as differentiating competitive and monopolistic price-making, 630.—The law of increasing returns and price-making, 631.—Consumers' leagues and limitation of monopoly prices, 632.—Responsiveness of business, the law of increasing returns, and discrimination, 633.—Detailed statement of the elements to be considered in price-making and mathematical expression of these elements, 634.

Earnings may be retained for a variety of reasons, some obvious and definite, others more difficult to analyze and to measure. Faced with the need to reflect information about the retention of earnings on financial statements, accountants have resorted to the use of reserves to accomplish this task. According to John A. Beckett retained earnings can be subjected to critical analysis for the benefit of management and other interested parties by indicating the reasons for retention of undistributed earnings. The normal problem of replacement is accentuated when a decline in the purchasing power of the dollar takes place. Since the subdivision of retained earnings will reflect both past accomplishments and future plans, it is doubtful if in many cases the un-appropriated balance will be large enough to warrant questioning by the Tax Department under the accumulated earnings tax provisions. This assumes, that the corporation presents substantial and acceptable evidence of serious intent to support its functional breakdown of retained earnings.