What causes changes in the pattern of expectations of financial market
participants regarding future cash flows and prices of particular securities? How
are financial assets valued?
Expectations of financial-market participants cause their buying or sell
Course ID Number: 12
Term Structure Analysis (re-done)
The term structure of interest rates is illustrated by a yield curve that depicts the
relationship between time to maturity and interest rates for default-free
Finance 310, Fall 2013
Meltdown by Thomas E. Woods Jr.
Meltdown, by Thomas E. Woods a brilliant Austrian Economist, serves as an
antidote to the general lack of understanding about the stock market crash in fall of 2008
and how the govern
What is the economic function of financial securities?
Equilibrate the structure of real production (changing the identities of specific
assets employed and rejected). They bring the plans and expectations of investors
into greater coordination w
Course ID Number: 12
Term Structure Analysis
The term-structure graphs for the Bonds, Notes, and Bills show a continuous rise
in Yield to Maturity over time. The only period of decline coming with the Treasury Note
10. What is the difference between expectations regarding future cash flows of
financial securities and values of benefits to be received from consumption goods?
With expectations regarding future cash flows of securities, you have no
experience with them
1. Explain hot the demand for money and the supply of money cause changes in the
purchasing power of the monetary unit.
Changes in the in the quantity of money outstanding in circulation are the major
determinants of changes in the purchasing power of the
Final Study Guide
Explain how the effects of the Federal Reserve Monetary Policy move through the
economy beginning with the purchase of particular securities from on particular
The Federal Reserve can increase or decrease the monetary poli
What is a major cause in changes of the purchasing power of money as time
As increase in the quantity of money, people adjust their expectations of future
purchasing power and affect velocity. Velocity of money goes up. Major causes of
Treasury Bond, Stripped Principal