IN GEOMETRIC TERMS

in order to get $100 added to his present income. Thisposition would require a sacrifice of $130 out of nextyear’s income, which, however, he need not make forhe can get his accommodation for $110 of next year’s in-come and find himself at Mi.

Individual 2, on the other hand, whether because ofhis temperament, or because of a different time distribu-

CHART 33

Adjusting Impatience to Market Rate of Interest Through Lending.

tion of his income, may behave quite differently. Hisposition to start with, let us say, is P 2 in Chart 33. Ifhis impatience, under these circumstances, is only 2 percent, when the market rate is 10 per cent, he will notborrow, but will lend. He will continue to lend until hisdegree of impatience is as great as the market rate ofinterest, that is as long as his Willingness line, at eachstage, is less steep than the Market line.

Thus, the angle at P between the M line and W line

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