EC249 Lecture Notes - Lecture 16: Market Capitalization, Exchange Rate, S&P 500 Index
Document Summary
Midterm 2: next friday, bring a calculator, chapters 5-8, 20, 32 mc @. 25% each, 8% total, 3 short answer on international parity, 4% total. Question on the final about this: 4 short answer questions @2% each, 8% total. Return on equity: is the change in price. A benchmark: is a point of reference by which something can be measured, in finance is typically a risk free or low risk rate, in finance is often the 90 day t-bill rate. The equity markets of developed economies: tend to be more liquid than those of developing economies. Measured by looking at the volume of the transactions and then deflate it by the market cap, if greater than 1, turnover is at least once: tend to have smaller market capitalization than developing economies. Market cap: number of outstanding shares times the price: tend to have more volatile growth rates. Share prices: almost always go up because inflation is almost always positive.
