00:01
All right.
00:01
So for this question, we're thinking about a personal example of an investment decision.
00:07
So i can't just give you the exact answer, but i can give you some of the things that you want to think about for this.
00:12
I'll give you an example that actually probably applies to you, given that you're putting this question into numerate.
00:19
So a good example would be college.
00:23
You may be attending college right now, or you are considering attending college.
00:27
This is probably applicable to you or someone you know.
00:31
And of course for college, you're making payments over time in order to increase your human capital.
00:38
Right? that's what you care about.
00:39
It's human capital.
00:40
Hc.
00:42
And you're making payments over time.
00:43
The idea is that by increasing your human capital, you're going to increase, well, you might just get some general enjoyment out of college.
00:51
You might just be happy paying all this tuition or having other people pay for your tuition for you to just experience being in college.
00:59
You might get some benefit from just knowing things, maybe you're reading classic literature, and that's edifying you as a person.
01:10
And so that's, i don't know, makes you happy to read classic literature, go and learn about great works of art.
01:22
But for most of college, at least, we think that we're doing something in order to increase a human capital that will have a positive impact on our wages, right? the idea is that our wages are somehow going to go up.
01:35
And that's where we're going to be thinking about bringing in supply and demand.
01:38
So the idea here is that there's a market for non -college educated people, non -c people, and there's some supply of those people, there's some demand for their labor, quantity of workers, and there's some equilibrium wage present.
02:07
And for college people, there's some supply, some demand, and some wage present.
02:18
And the hope is that this wage for no college, wage n, and this is wage c, the hope is that the wage you can get with your college degree is higher than the wage that you get with no college.
02:33
And in fact, that it's not just higher, that it's significantly higher, such that it's worth it to put the investment into attending college.
02:41
Okay.
02:43
So supply and demand matter for this because you want to think about, you know, this college degree, you're going to be investing in it for a few years.
02:52
You want to know what's going to be happening to supply and demand for jobs that require college degrees or do not college require college degrees in the future...