Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: crh02 who wrote (26799)	12/1/1998 8:52:00 PM
From: Will Lyons	Read Replies (2) \| Respond to of 70976

Economics 101 for techies The Accelerator A machine produces 1000 widgets per year Total demand is 10,000 per year A machine lasts ten years So we buy one machine per year [assuming no change in technology and that over time we have averaged things out so we always have ten machines running Now the demand for widgets goes up ten percent to 11,000 So we buy two machines this year, one to replace the worn out machine and the second to produce the additional ten percent. Voila! A ten percent growth in demand for widgets requires a doubling in the output of the machines . Now if the machines become obsoleted by advances technology... And if the machines are made by supermachines, then the need for supermachines skyrockets. Depending on the length of the food chain you can have quite an effect. We call it the accelerator. the British economists call it a gearing ratio No matter what you call it the effect is dynamic as witness the charts of the machine tool industry There will be a test tomorrow! Will