Friday, November 7th ECON200 Discussion Questions
1. Fill in the table:
Quantit
y
Variable
Cost
Fixed
Cost
0
1
2
3
4
Total
Cost
Marginal
Cost
Avera
ge
Cost
100
200
70
133
560
2. Madeline quits her job, at which she was earning $20,000 per year. She then t
The CAPM
Alvaro Pedraza
Lecture 10
The Capital Asset Pricing Model
The CAPM describes:
general equilibrium in capital markets
expected returns as a function of risk
one of the centerpieces of finance
Simplifying Model Assumptions
1. investors are price ta
ll beahgoﬁl‘igm Loaﬁng” 52696
ﬁoseph GU Sﬂx‘gQAB . {(3.6‘4-‘94?
CHAPTER 3
Making Trade Fair
f any trade agreement were to be a success, it should have been the
one among Mexico, the United States, and Canada. Enacted in
1994, the North American Free Trade
ECON LAB
SESSION 2
Mathematical Practice Revision
(cont.)
SOLUTIONS
(a), (c), (d), (c), (d), (b)
DRAW A DIAGRAM
4. Answer each of the following questions by drawing a schematic diagram.
a. Taking measurements of the slope of a curve at three points farth
Globalization: Threat or Opportunity?
A Comentary By the International Monetary Fund Staff (00/01)
(For the full version of this text, please refer to www.imf.org/external/np/exr/ib/2000/041200.htm)
I. Introduction
The term "globalization" has acquired co
CFA Institute
On the Quality of Municipal Bonds
Author(s): Jack L. Treynor
Source: Financial Analysts Journal, Vol. 38, No. 3 (May - Jun., 1982), pp. 25-30
Published by: CFA Institute
Stable URL: http:/www.jstor.org/stable/4478544 .
Accessed: 18/07/2013 1
Chapter 2
Chapter 3
9. You are bullish on Telecom stock. The current market price is $50 per share,
and you have $5000 of your own to invest. You borrow an additional
$5000 from your broker at an interest rate of 8% per year and invest
$10000 on the stock
Speculative Bubbles and
Behavioral Finance
Alvaro Pedraza
Speculative Bubbles
The Tulip-Bulb Bubble (1593)
The South Sea Bubble (1720)
Market Crash of 1929
The Soaring Sixties
The Conglomerate Boom (1960s)
The Biotechnology Bubble (1980s)
The Internet Bub
Year Risk-Return Analysis for Stock A
PRICE
100
State of the Market
Excellent
Good
Poor
Crash
Expected Return
Variance of HPR
Standard Deviation
Risk Premium
Sharpe Ratio
Risk Free Rate
Probability
0.2
0.4
0.3
0.1
3.10%
5.63%
23.7%
2.90%
0.1222
0.20%
Year
ECON435: Problem Set #1
Due October 03/2013 at 11:00am
September 19, 2013
1
(25 points) The U.S. Financial Industry
You want to study the behavior of the nancial sector in the U.S. in the past 10 years by
looking at the market prices of nancial rms. Your
Security Trading
Alvaro Pedraza
Lecture 5
Market for Securities
Primar
y
Market
Firms raise
capital by
Second
selling
securities
ary
Market
Trading
between
investors
Bondsandother
shorttermdebt
PublicOffering
Equity
IPO(InitialPublic
PrivateOffering
Of
Monopsony Model
A monopsony is a market with one single buyer, just
as a monopoly is a model with one single seller.
While this model is unrealistic, it is a good benchmark
from which we can gauge how a market where buyers
have market power because they a