And on the cash flow statement you express that saying

We have a very, very steady business.

Wait! But we spent that 60,000, especially in year 1

Japanese corporations are slashing their capital spending programs.

We need flat land, we need 300 days of sunlight, and we need to be near a gas pipe.

This was not a cash expense, so from our operations we had 50,000 dollars,

And if they say no, ask them why not? Ask them what's more important?

Without billions of dollars from the private sector

And so liabilities plus equity is equal to assets.

I spent 60,000 on Capital Expenditure sometimes it's property plant and equipment .

But if your fuel source is free, then the only thing that matters is the up front capital cost of the engine.

Building materials are expensive now.

That assets, A for assets, is equal to

But we'll do a whole playlist on that.

For Principal Fuentes, PS 24's modest investment in the programs has paid big dividends.

Now we have 3,000 apples being produced, because these were really good investments.

And what is required is a combination of physical capital, institutional capital, human capital and security, of course, is critical, but so is information.

It should start to make a little bit of intuitive sense

And then on the equity side, because we have no liability, so in this case assets will be equal to equity.

So this is a good way to think about it.

The return on the investment will be high.

But our total assets, or the market's perception of the total assets of the company, are essentially what it's willing to pay for the equity plus the liabilities, so the market is saying that Ben's assets, the assets in that company are worth 220,000.

liabilities plus equity.

When did frobisher's people approach you?

We got a second address. There's a coowner.

The company was started with 100,000 in capital.

I still owe the almost 1.075 million.

Yes, put that aside.

In the last set of videos, we've hopefully familiarized ourselves with the different ways that a company can raise capital.

In a world without leverage so if I didn't have all this

So this is just another visual representation that

less capital intensive that there's less money that's required

It doesn't sound like we borrowed money or anything.

Assets are always equal to liabilities plus equity.

That just comes out of the definition of what equity is.

I'll draw it a little bit bigger.

But let's say its assets are worth 1 million.

The most obvious solution is to take from those who earn the most.

Capitalist country.

So essentially, instead of Countrywide being responsible for my loan, my payments now go to these investors.

The liabilities, we had Loan C, it's coming due for 3 billion.

Prepare to leave.

Time is against us.

Make ready to depart.

So he owns it outright so all of the 100,000 of asset value is actually his equity.