Substitution Example

Let's make a substitution.

We call this reward substitution.

Well, let's just make a substitution.

So let's make a substitution here.

So the 1 million asset would really become an 800,000 asset.

Can we do something like reward substitution?

It's the same asset.

So that's the asset.

So it's an asset.

That's an asset, right?

But our fantasies of substitution have cost us.

Okay, here's my solution to the 3rd substitution.

So we can start from either substitution rule.

And there's only 1 substitution rule for word.

So here, the substitution is pretty clear, right?

That's its asset it has.

So it's an illiquid asset.

This is a real asset.

Why is cash an asset?

But we said n this substitution comes into this.

So let's make a substitution for y over x.

Now what's this situation? It's not exactly reward substitution.

So now, we can do the substitution with v.

The entire asset was his equity.

It's derived from the original asset.

That improves my return on asset.

So I would revalue the asset.

So cash could be an asset.

So that's what an asset is.

He would be a great asset.

So what we can do is we can do substitution.

So when you have an asset, if the asset is cash, the rent on it is interest.

And so you create a derivative asset.

I have a 5 return on asset.

He's getting this great return on asset.

I'm getting this crummy return on asset.

So my return on asset is 7 .

I have one asset in the world.

So for example, cash is an asset.

But it's a quick substitution, and it saves us some time.

Then I can make a variable substitution that makes it separable.

I'm going to make 1 substitution. That's what I'm doing here.

So what is our integral going to become with this substitution?

We made the substitution that v is equal to y over x.