But the ore
will some day be exhausted and the dividends cease. Purchasers of the stock
should accordingly consider amortization and pay only such price as will
be covered by the discounted value of the prospective dividends during the
life of the mine. The price of the output fluctuates, however, and the
rate of any year's earnings can only be conjectured. Precise reckoning is
therefore impracticable, and the stock will rise and fall in the market in
response to the play of conjectures as to the present value of the total
future earnings applicable to dividends. So also a planter entering the
slave market might have reckoned in advance the prospect of working life
which a slave of given age would have, and the average earnings above
maintenance which might be expected from his labor. By discounting each of
those annual returns at the prevailing rate of interest to determine their
present values, and adding up the resulting sums, he would ascertain the
price which his business prospects would justify him in paying. Having
bought a slave at such a price, an equally thoroughgoing caution would have
led him to take out a life, health and accident insurance policy on the
slave; but even then he must personally have borne the risk of the slave's
running away.
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