Please enable JavaScript.

Coggle requires JavaScript to display documents.

Introduction - Coggle Diagram

- - - - Interest rates
        
        Not for hk
    - - Managing publici investments and consumption behaviours
      - Taxation
      - Measuring economic activity
        
        GDP = C + I + G + X
        
        Deficiencies
        
        no measuring hoswiufes
        
        not measuriing. negative externalities
        
        Consumption vs.Investment
        
        Consumption only brings growth in the short run and creates problems down the line
        
        The poor spends more than they earn, and the rich saves more in both absolute and relative terms
        
        Marginal propensity to consume [MPC].
        
        1 more item...
        
        Marginal propensity to save [MPS]
        
        1 more item...
        
        Investment brings bore consumption in the future - return
- - - - In HK 70% shared by 5 firms
  - - - The price is highy dependent on physical location
        
        There is some level of substitublility but ultimately every product is unique due to inelastic supply of land
      - durable
      - constitutes wealth
      - constitutes other assets such as stock
      - Cobb-Douglas utility function
        
        Process
        
        Step 1: Gather Information
        
        Size of the Property (S): Let's say your property is 2,000 square feet.
        
        Location Quality (L): We’ll rate the location on a scale of 1 to 10. Let’s say your location is rated as a 7.
        
        Step 2: Set the Constants
        
        For this example, we'll use arbitrary values for ( A ), ( a ), and ( b ):
        
        A (constant): 50 (this is like the "base price")
        
        a (size influence): 0.5 (this means size contributes half the value)
        
        b (location influence): 0.5 (this means location contributes half the value)
        
        Step 3: Plug the Values into the Cobb-Douglas Formula
- - - - sometimes bc of competition they cut corners leading to less safety
- - - - High transaction costs
        
        legal ownership change
        
        have to obey government
        
        search costs