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... implemented easily. Section 3 derives some basic properties of two underlying processes. In section 4, we propose an algorithm for constructing the binomial processes in section 3 by extending a method suggested by Ho, Stapleton and Subrahmanyam (1995). The method is to approximate a bivariate logno ...
... implemented easily. Section 3 derives some basic properties of two underlying processes. In section 4, we propose an algorithm for constructing the binomial processes in section 3 by extending a method suggested by Ho, Stapleton and Subrahmanyam (1995). The method is to approximate a bivariate logno ...
Some Current Controversies in the Theory of Inflation
... product that maximizes profits in real terms and maintains that real price by adjusting his nominal price to allow for inflation. The logical implication is that, given the degree of monopoly power, monopolists would have no incentive to raise prices other than to catch up or keep pace with general ...
... product that maximizes profits in real terms and maintains that real price by adjusting his nominal price to allow for inflation. The logical implication is that, given the degree of monopoly power, monopolists would have no incentive to raise prices other than to catch up or keep pace with general ...
Franklin Floating Rate Daily Access Fund Summary Prospectus
... or securities may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan or debt security that has fewer restrictions typically does not include the legal clauses which allow an investor to monitor the performance of the borrower/issuer. The Fund may trea ...
... or securities may have tranches that contain fewer or no restrictive covenants. The tranche of the covenant lite loan or debt security that has fewer restrictions typically does not include the legal clauses which allow an investor to monitor the performance of the borrower/issuer. The Fund may trea ...
Economic Development and the Role of Currency Undervaluation Surjit S. Bhalla
... Dollar-Easterly series, have generally failed to find any significant effects of currency undervaluation on developing country growth. Traditional and New Estimates of the Real Exchange Rate Table 1 reports the estimates obtained for 1996–2007 for the four different methods in existence: Dollar, the ...
... Dollar-Easterly series, have generally failed to find any significant effects of currency undervaluation on developing country growth. Traditional and New Estimates of the Real Exchange Rate Table 1 reports the estimates obtained for 1996–2007 for the four different methods in existence: Dollar, the ...
ProposedRuleAttach2015-00056
... Any interested person may participate in the rule making through submission of written data, views and arguments to the Division of Real Estate. Persons are requested to submit data, views and arguments to the Division of Real Estate in writing no less than ten (10) days prior to the hearing date an ...
... Any interested person may participate in the rule making through submission of written data, views and arguments to the Division of Real Estate. Persons are requested to submit data, views and arguments to the Division of Real Estate in writing no less than ten (10) days prior to the hearing date an ...
ch16_FinancialMarkets
... • Discount Rate = rate of interest Fed charges banks to borrow reserves • Federal Funds rate = rate of interest banks charge each other to borrow reserves • Increase in either rate will decrease amount of borrowing of reserves (too expensive to borrow) – Banks will sell securities or loan out le ...
... • Discount Rate = rate of interest Fed charges banks to borrow reserves • Federal Funds rate = rate of interest banks charge each other to borrow reserves • Increase in either rate will decrease amount of borrowing of reserves (too expensive to borrow) – Banks will sell securities or loan out le ...
This PDF is a selection from an out-of-print volume from... of Economic Research Volume Title: Rational Expectations and Economic Policy
... consumption of leisure or non-market-produced goods and services. Monetary shocks confound relative price shifts resulting in correlated supply errors in a decentralized economy. Crucial to this theory is the intertemporal substitutability of leisure, which implies that temporary changes in expected ...
... consumption of leisure or non-market-produced goods and services. Monetary shocks confound relative price shifts resulting in correlated supply errors in a decentralized economy. Crucial to this theory is the intertemporal substitutability of leisure, which implies that temporary changes in expected ...
Reassessing Discretionary Fiscal Policy
... enough that the real interest rate rises. I11 developing this framework, I first assume that inflation is the only variable in the monetary policy rule, though in reality, as shown below, real output appears too. The second relationship is between real GDP and the real interest 1-ate-analogous to a ...
... enough that the real interest rate rises. I11 developing this framework, I first assume that inflation is the only variable in the monetary policy rule, though in reality, as shown below, real output appears too. The second relationship is between real GDP and the real interest 1-ate-analogous to a ...
The final version of the Department of Labor`s fiduciary rule was
... The final version of the fiduciary rule clarifies that the BICE need not be signed until an account is opened. Firms do not need to have existing customers sign a Best Interest Contract. Unlike the proposed rule, firms are allowed to send a notice to existing clients to inform them that they have as ...
... The final version of the fiduciary rule clarifies that the BICE need not be signed until an account is opened. Firms do not need to have existing customers sign a Best Interest Contract. Unlike the proposed rule, firms are allowed to send a notice to existing clients to inform them that they have as ...
Chapter 27 The Phillips Curve and Expectations Theory 1. The
... b. unemployment will work leaving the inflation rate unchanged. c. inflation will cause employment to rise. d. unemployment will work causing the inflation rate to fall. ANS a. Correct. If the long-run Phillips curve is vertical, then any government policy designed to lower unemployment will not cha ...
... b. unemployment will work leaving the inflation rate unchanged. c. inflation will cause employment to rise. d. unemployment will work causing the inflation rate to fall. ANS a. Correct. If the long-run Phillips curve is vertical, then any government policy designed to lower unemployment will not cha ...
When is the Government Spending Multiplier Large? Northwestern University
... it can be socially optimal to substantially raise government spending in response to shocks that make the zero lower bound on the nominal interest rate binding. We begin by considering an economy with Calvo-style price frictions, no capital and a monetary authority that follows a standard Taylor ru ...
... it can be socially optimal to substantially raise government spending in response to shocks that make the zero lower bound on the nominal interest rate binding. We begin by considering an economy with Calvo-style price frictions, no capital and a monetary authority that follows a standard Taylor ru ...
The Short-Run Tradeoff between Inflation and Unemployment
... Costless Disinflation • The theory of rational expectations suggests that people optimally use all the information they have, including information about government policies, when forecasting the future. • Expected inflation explains why there is a tradeoff between inflation and unemployment in the ...
... Costless Disinflation • The theory of rational expectations suggests that people optimally use all the information they have, including information about government policies, when forecasting the future. • Expected inflation explains why there is a tradeoff between inflation and unemployment in the ...
Valuation - Ohio University College of Business
... This is a site of the Edinburgh Business School. I have also included one in Appendix 1. So if you wanted to find the present value of $100, in one year, 10% interest, you go to the 10% column, go to row 1 (for one year) and you find the value .909. You multiply that number times the future value yo ...
... This is a site of the Edinburgh Business School. I have also included one in Appendix 1. So if you wanted to find the present value of $100, in one year, 10% interest, you go to the 10% column, go to row 1 (for one year) and you find the value .909. You multiply that number times the future value yo ...
SVP-SV and Rising Interest Rates.indd
... economy by lowering short-term interest rates. The stable value returns were achieved with only a fraction of the volatility experienced by traditional fixed income investments. As the U.S. economy faces nearly unprecedented low yields, it is reasonable to assume that rates will eventually reverse c ...
... economy by lowering short-term interest rates. The stable value returns were achieved with only a fraction of the volatility experienced by traditional fixed income investments. As the U.S. economy faces nearly unprecedented low yields, it is reasonable to assume that rates will eventually reverse c ...
Christina D. Romer NATIONAL
... more complex way used to calculate current inflation described in n. 3. Using the more complex definition has essentially no effect onthe estimated real interest rate series. For the period since 1955, the data are from the Congressional Budget Office. The data for 1950-54 are described in Carlson ( ...
... more complex way used to calculate current inflation described in n. 3. Using the more complex definition has essentially no effect onthe estimated real interest rate series. For the period since 1955, the data are from the Congressional Budget Office. The data for 1950-54 are described in Carlson ( ...
Monetary Policy Statement June 2007 Contents
... employment and investment intentions, have been strong. As we have noted recently, government spending continues to increase, which is contributing to domestic demand. Following several years of strong growth, firms have indicated that capacity remains stretched and that finding both skilled and uns ...
... employment and investment intentions, have been strong. As we have noted recently, government spending continues to increase, which is contributing to domestic demand. Following several years of strong growth, firms have indicated that capacity remains stretched and that finding both skilled and uns ...
Interest rate
An interest rate is the rate at which interest is paid by borrowers (debtors) for the use of money that they borrow from lenders (creditors). Specifically, the interest rate is a percentage of principal paid a certain number of times per period for all periods during the total term of the loan or credit. Interest rates are normally expressed as a percentage of the principal for a period of one year, sometimes they are expressed for different periods such as a month or a day. Different interest rates exist parallelly for the same or comparable time periods, depending on the default probability of the borrower, the residual term, the payback currency, and many more determinants of a loan or credit. For example, a company borrows capital from a bank to buy new assets for its business, and in return the lender receives rights on the new assets as collateral and interest at a predetermined interest rate for deferring the use of funds and instead lending it to the borrower.Interest-rate targets are a vital tool of monetary policy and are taken into account when dealing with variables like investment, inflation, and unemployment. The central banks of countries generally tend to reduce interest rates when they wish to increase investment and consumption in the country's economy. However, a low interest rate as a macro-economic policy can be risky and may lead to the creation of an economic bubble, in which large amounts of investments are poured into the real-estate market and stock market. In developed economies, interest-rate adjustments are thus made to keep inflation within a target range for the health of economic activities or cap the interest rate concurrently with economic growth to safeguard economic momentum.