Basics 2: Capital & Saving

This lecture covers the basics of capital and saving, including the general formula for capital accumulation, the concept of saving as the increase of wealth, conditions for a growing capital stock, and methods for estimating a stock of capital. The instructor explains how capital varies intrinsically and extrinsically, the relationship between saving and investment, and the importance of consumption not exceeding production. Various methods such as the capitalization method, permanent inventory method, and net present value method are discussed in detail.