The Dow Jones Industrial Average is an index of the prices of only 30 stocks. Consider a much broader measure of the stock market -- the market value of equities (FRED code: MVEONWMVBSNNCB)– which sums the price of each stock times the number of outstanding shares. After plotting it, comment on its pattern since the mid-1990s.
Answer to relevant QuestionsCompute the future value of $100 at an 8 percent interest rate 5, 10, and 15 years into the future. What would the future value be over these time horizons if the interest rate were 5 percent?Most businesses replace their computers every two to three years. Assume that a computer costs $2,000 and that it fully depreciates in 3 years, at which point it has no resale value and is thrown away.(LO1)a. If the ...Recently, some lucky person won the lottery. The lottery winnings were reported to be $85.5 million. In reality, the winner got a choice of $2.85 million per year for 30 years or $46 million today.a. Explain briefly why ...How does inflation affect nominal interest rates? a. Plot the three-month U.S. Treasury bill rate (FRED code: TB3MS) from 1960 to the present. What long-run pattern do you observe? What may have caused this pattern? b. Plot ...For each of the following events, explain whether it represents systematic risk or idiosyncratic risk and explain why. a. Your favorite restaurant is closed by the county health department.b. The government of Spain defaults ...
Post your question