the rate of inflation plus the real rate of interest.

the nominal rate of interest, assuming the Fisher Principle holds

the difference between the rate of growth of the money supply and the rate of inflation

the difference between the foreign and domestic inflation rates

0 = (Y1 - C1) + (Y2 - C2 )/(1+r)

C1 + C2/(1+r) = ?

(Y1 - C1) = (Y2 - C2 )/(1+r)

C1 + C2/(1+r) = Y1 +Y2/(1+r)

OB

DB

OY1+OY2

The area of the rectangle OY1AY2

F(K)/(1+r) minus K

F(K) minus K/(1+r)

F(K) minus K

K times (1+r)

that Ricardian equivalence fails.

that in a global world it is always possible for a nation to borrow abroad.

that a Ponzi-scheme is necessary so the firm is indifferent

that firms belong to their shareholders and the net return from investment raises their wealth