interest rate of 120 percent per year so that $220 would be repaid next year for a
loan of $100 today.
In practice, they suggest the trial use of three rates – high, medium, and low –
to sort out projects that are obviously good and obviously bad. The marginal ones
can be put off until the planners see how large the investment program will be and
whether any better projects come along to displace the marginal ones (Little and
Mirrlees 1968; Baldwin 1972:20; Alchian and Allen 1972:467–468)