Economics 422: Investment, Capital, and Finance

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Lecture Notes and Class Slides

Note: These notes and accompanying spreadsheets are preliminary and incomplete and they are not guaranteed to be free of errors. Check the revision dates for updates. I will be updating the slides and spreadsheets throughout the quarter. Please let me know if you find typos or other errors. Comments and suggestions are welcome. 

Investment Project

• Class slides (updated July 29, 2007)

Introduction

• Class slides: 422aintro_ez.pdf (updated July 20, 2010)

Fisher Model

• Class slides: 422fisher1_ez.pdf (updated July 20, 2010)

• Class slides: 422fisher2_ez.pdf (updated July 20, 2010)

• Excel spreadsheet illustrating utility functions: econ422Utility.xls (updated July 20, 2006 with instructions for using the solver)

• Fisher separation theorem example (added July 20, 2007)

Present Value Calculations

• Class slides: Present Value Methodology EZ.pdf (updated April 11, 2010)

• Excel spreadsheet illustrating present value calculations: econ422PresentValueProblems.xls

Security Valuation: Bonds

• Class slides: Security Valuations_Bonds.pdf (updated April 11, 2010)

• Excel spreadsheet illustrating bond calculations: econ422Bonds.xls

Security Valuation: Stocks

• Class slides: Security Valuations Stocks.pdf (updated August 14, 2006)

Investment Decision Making

• Class slides: Investment Decision Making EZ.pdf (updated August 14, 2006)

• Excel spreadsheet illustrating NPV and IRR calculations: econ422NPV.xls

Random Variable Review

• Class slides: Random Variable Review EZ.pdf (updated August 2, 2007)

• Excel spreadsheet illustrating random variable calculations: econ422RV.xls (updated August 2, 2007)

Decision Making Under Uncertainty

• Class slides: Expected Utility Theory EZ.pdf (updated August 14, 2006)

Introduction to Risk and Return

• Class slides: Risk & Return Updated.pdf (updated August 9, 2010)

• Excel spreadsheet illustrating sample statistics: econ422RiskReturn.xls

Portfolio Theory

• class slides: Portfolio Theory EZ.pdf (updated August 14, 2006)

• Excel spreadsheet illustrating portfolio computations: econ422portfolio.xls

Capital Asset Pricing Model

• Class slides: CAPM EZ.pdf (updated August 14, 2006)

• Excel spreadsheet illustrating estimation of beta: singleIndexClassExample.xls

Efficient Markets Hypothesis

• Class slides:  Market Efficiency EZ.pdf (updated August 14, 2006)

Options

• Class slides:  Options EZ.pdf (updated July 15, 2005)

• Excel spreadsheet illustrating Black-Scholes option pricing formula: econ422options.xls

Hedging Financial Risk

• Class slides: Hedging Financial Risk EZ.pdf (updated July 18, 2005)