ECO 323 R ECITATION 3
W ONHO Y EON
WONHO. YEON @ STONYBROOK . EDU
D EPARTMENT
OF
E CONOMICS , S TONY B ROOK U NIVERSITY
September 18, 2015
1. Understanding Options
(a) A call option gives its owner the right to buy stock at a specied exercise or strike pr
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2013. Tu/Th 1pm to 2:20pm
Applied Microeconomics
Professor: Hugo Bentez-Silva
http:/www.stonybrook.edu/economics/people/faculty/directory/hbenitez/ECO323.htm
The major focus of this course is the
Chapter 10
Intertemporal
Choice
Intertemporal Choice
Persons often receive income in
lumps; e.g. monthly salary.
How is a lump of income spread over
the following month (saving now for
consumption later)?
Or how is consumption financed by
borrowing now
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor: Hugo Bentez-Silva
Problem Set 3: Due Thursday November 5, 2015
1.Short Questions. Remember to justify your answers.
a) A risk-averse individual is offered a choice between a gamble
ECO 323 R ECITATION 1
W ONHO Y EON
WONHO. YEON @ STONYBROOK . EDU
D EPARTMENT
OF
E CONOMICS , S TONY B ROOK U NIVERSITY
September 4, 2015
1. Draw the budget constraint
(a) Mike earns 100 in period 1 and will earn 24 in period 2. No borrowing or lending is
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor Hugo Bentez-Silva
Problem Set 2: Due Thursday October 1, 2015 in class.
Please in your answers always show your work. Otherwise your grade will
suffer considerably. There are 3 sect
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor Hugo Bentez-Silva
Problem Set 2 Suggested Solutions.
1. It is not a lie if you believe it! But do you? (Again, justify your answers). (30%)
a) In the framework of valuing an option
ECO 323 Applied Microeconomics
R ECITATION M ATERIAL
W ONHO Y EON
Department of Economics
[email protected]
FALL 2015
Outline
How to Calculate Present Values
Future Values and Present Values
Perpetuities and Annuities
Investment Criteria
Net Prese
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor Hugo Bentez-Silva
Problem Set 1: Suggested solutions. If you have any questions about these
answers, or need further clarification, do not hesitate to drop me a line, come
to my off
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2013
Professor Hugo Bentez-Silva
Additional Practice Questions for the Final Exam. The real thing will be Monday
December 16, 5:30pm to 8:00pm, in our regular classroom.
I will not distribute answ
Chapter 13:
SIMPLE LINEAR REGRESSION
SIMPLE LINEAR
REGRESSION
Simple Regression
Linear Regression
2
Simple Regression
Definition
A regression model is a mathematical equation
that describes the relationship between two or
more variables. A simple regressi
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2013
Professor Hugo Bentez-Silva
Additional Practice Questions for the Final Exam. The real thing will be Monday
December 16, 5:30pm to 8:00pm, in our regular classroom.
I will not distribute answ
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2012
Professor Hugo Bentez-Silva
Midterm 2: November 20, 2012
Suggested Solutions
100 points were at stake, plus 7 in extra-credit. There are 5 parts.
1. True or False. Credit will only be given f
Price Theory
Lecture 3A: Choice Under Uncertainty
I.
Probability and Expected Value
In all that we have done so far, we've assumed that choices are being made under
conditions of certainty - prices are known, income is known, and so forth. But many
situat
Chapter Ten
Intertemporal Choice
Intertemporal Choice
Persons often receive income in
lumps; e.g. monthly salary.
How is a lump of income spread over
the following month (saving now for
consumption later)?
Or how is consumption financed by
borrowing now
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2013
Professor Hugo Bentez-Silva
Practice Final Exam. The real thing will be December 16, 2013, from 5:30pm to
8:00pm, in our regular classroom.
Remember to show your work in every question you an
Chapter 18
Multiple
Regression
18.1 Introduction
In this chapter we extend the simple
linear regression model, and allow
for any number of independent
variables.
We expect to build a model that fits
the data better than the simple linear
regression mode
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2013
Professor Hugo Bentez-Silva
Practice Final Exam. The real thing will be December 16, 2013, from 5:30pm to
8:00pm, in our regular classroom.
Remember to show your work in every question you an
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor Hugo Bentez-Silva
Problem Set 1: Due Tuesday September 15, 2015 in class
Please in your answers always show your work. Otherwise your grade will
suffer considerably. There are 6 sec
Chapter Ten
Intertemporal Choice
Intertemporal Choice
Persons often receive income in
lumps; e.g. monthly salary.
How is a lump of income spread over
the following month (saving now for
consumption later)?
Or how is consumption financed by
borrowing now
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor Hugo Bentez-Silva
Suggested Solutions to Midterm 1: October 8, 2015
100 points were at stake, plus 5 in extra-credit.
1. True or False. Credit will only be given for justified answe
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor Hugo Bentez-Silva
Sample Questions for Midterm 1 (October 8th).
Remember that for this midterm you have to study the following topics:
Investment theory (for example: present value,
ECO 323 R ECITATION 8
W ONHO Y EON
WONHO. YEON @ STONYBROOK . EDU
D EPARTMENT
OF
E CONOMICS , S TONY B ROOK U NIVERSITY
October 22, 2015
1. Measures of Central Tendency
(a) Please use recitation08 excel le on the blackboard. Using the data given in Q1 she
ECO 323 R ECITATION 7
W ONHO Y EON
WONHO. YEON @ STONYBROOK . EDU
D EPARTMENT
OF
E CONOMICS , S TONY B ROOK U NIVERSITY
October 15, 2015
1. Risk-averter vs. Risk-lover
(a) Draw utility functions of risk averse, risk loving, and risk neutral investors.
(b)
ECO 323 R ECITATION 4
W ONHO Y EON
WONHO. YEON @ STONYBROOK . EDU
D EPARTMENT
OF
E CONOMICS , S TONY B ROOK U NIVERSITY
September 24, 2015
1. Interest rate
r = Discount rate
= Hurdle rate
= Opportunity cost of capital
= Rate of return of equally risky inv
ECO 323 R ECITATION 5
W ONHO Y EON
WONHO. YEON @ STONYBROOK . EDU
D EPARTMENT
OF
E CONOMICS , S TONY B ROOK U NIVERSITY
October 2, 2015
1. Perpetuity
(a) Denition of Perpetuity or Consol
Investment offering a level stream of cash ows indenitely.
ordinar
SUNY-Stony Brook. Economics Department
Economics 323: Fall 2015
Professor Hugo Bentez-Silva
Suggested Answers to Sample Questions for Midterm 1 (October 8th)
1.True or False. Remember that in the exam credit will only be given for justified
answers.
a) In
Intro to Data Analysis, Economic Statistics and
Econometrics
Statistics deals with the techniques for collecting and
analyzing data that arise in many different contexts.
Econometrics involves the development and use of
special statistical methods within
More on Risk Aversion and Uncertainty
Risk Aversion should not be understood as meaning that individuals
do not want to take risks. Risk averse individuals will take risk, but
the odds will have to be relatively favorable for that to happen.
An agent is