46. Economics and Investment Markets Flashcards
1
Q
present value formula for the value at time t of any financial asset i
A
2
Q
Notation - present value formula for the value at time t of any financial asset i
A
3
Q
general expression for the discount rate
A
4
Q
Inter-temporal rate of substitution
A
The ratio of the marginal utility of consumption s periods in the future (the numerator) to the marginal utility of consumption today (the denominator).
5
Q
Payoff for an investment in a zero-coupon bond at time t that is certain to pay off one unit of real consumption in s periods
A
where m~t,s is the investor’s marginal willingness to trade consumption at time t for (real) wealth at time t + s
6
Q
Return on bond in one year w/ payoff $ 1
A
(future payoff minus the current payment relative to the current payment)
7
Q
A
8
Q
A
9
Q
A
10
Q
A
11
Q
A
12
Q
A
13
Q
A
14
Q
A
15
Q
A
