Measuring time by decades along the horizontal base line and the rate of wages at the beginning of a century by the line _AB_, we represent the increase in the pay of labor which would be brought about by an increase of capital not counteracted by any other influence by the dotted line _BC_, and the reduction which would be caused by an increase of population by the dotted line _BE_. The line _BD_ describes the resultant effect of these two changes acting together, on the supposition that during the latter part of the century the growth of population is somewhat retarded and that the increase of capital is the predominating influence. We may further represent the change in the rate of wages which is caused by improvements in method and organization by lines rising above the one which expresses the trend of wages as it is affected only by an increase of capital and of population. [Illustration] _AF_ measures time as before and _AB_ the rate of pay at the beginning of the century. The dotted line _BE_ represents the rise in wages due to the increase of capital, as it more than counteracts the growth of population. The rise of the line _BD_ above _BC_ represents the additional increase in wages which is brought about by improvements of method, and finally, the rise of _BC_ above _BD_ expresses the further addition to the pay of labor which comes by reason of improved organization. The uppermost line _BC_ describes the resultant of all the dynamic changes on the supposition that they act in a natural way. It will be seen that _BC_ at first rises above _BD_ rapidly and later runs nearly parallel with it. This expresses the fact that while gains insured by organization may continue for a long period, the amount of them does not greatly increase after a fairly efficient type of organization has been secured. On the other hand, the fact that _BD_ rises above _BE_ by a wider and wider interval expresses the fact that gains which come from technical improvements may increase for an indefinitely long time. _The Rate of Interest contrasted with the Absolute Amount of it; this Amount Increasing._--The changes which make wages rise cause interest to fall and there would seem to be a partial offset for the general gain; but the chief cause of a declining _rate_ of interest is an increase of the _total amount_ of capital. The size of the income which comes to the capitalists as a class from their entire invested wealth grows larger wherever the amount of the fund increases more rapidly than the rate of interest falls. A million dollars yielding four per cent gives a larger income than a half million yielding five or six. It is a condition such as this which we have described in outline, and it enables the holders of investments to receive a constantly increasing total return, although the percentage yielded by a given amount invested grows continually smaller.