文档介绍：Chapter 15
Investment, Time, and Capital Markets
1
Chapter 1
Topics to be Discussed
Stocks Versus Flows
Present Discounted Value
The Value of a Bond
Present Value Criterion for Capital Investment Decisions
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Chapter 1
Topics to be Discussed
Adjustments for Risk
Investment Decisions by Consumers
Intertemporal Production Decisions--- Depletable Resources
How are Interest Rates Determined?
3
Chapter 1
Introduction
Capital
Choosing an input that will contribute to output over a long period of paring the future value to current expenditures
4
Chapter 1
Stocks Versus Flows
Stock
Capital is a stock measurement.
The amount of capital pany owns
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Chapter 1
Stocks Versus Flows
Flows
Variable inputs and outputs are flow measurements.
An amount per time period
6
Chapter 1
Present Discounted Value (PDV)
Determining the value today of a future flow of e
The value of a future payment must be discounted for the time period and interest rate that could be earned.
7
Chapter 1
Present Discounted Value (PDV)
Future Value (FV)
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Chapter 1
Present Discounted Value (PDV)
Question
What impact does R have on the PDV?
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Chapter 1
PDV of $1 Paid in the Future
$ $ $ $ $ $
Interest
Rate 1 Year 2 Years 3 Years 4 Years 5 Years 6 Years
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Chapter 1