Chapter 15 Investment, Time and Capital Markets
Chapter 15 Investment, Time, and Capital Markets
Topics to be Discussed a Stocks versus Flows Present discounted value ■ The va| ue of a bond a The net present value criterion for Capital Investment Decisions Chapter 15 Slide 2
Chapter 15 Slide 2 Topics to be Discussed ◼ Stocks Versus Flows ◼ Present Discounted Value ◼ The Value of a Bond ◼ The Net Present Value Criterion for Capital Investment Decisions
Topics to be Discussed ■ Adjustments for Risk a Investment Decisions by Consumers a Intertemporal Production Decisions Depletable Resources How are Interest rates determined? Chapter 15 Slide 3
Chapter 15 Slide 3 Topics to be Discussed ◼ Adjustments for Risk ◼ Investment Decisions by Consumers ◼ Intertemporal Production Decisions--- Depletable Resources ◼ How are Interest Rates Determined?
Introduction a Capital o Choosing an input that will contribute to output over a long period of time o Comparing the future value to current expenditures Chapter 15 Slide 4
Chapter 15 Slide 4 Introduction ◼ Capital ⚫ Choosing an input that will contribute to output over a long period of time ⚫ Comparing the future value to current expenditures
Stocks versus flows Stock o Capital is a stock measurement The amount of capital a company owns Chapter 15 Slide 5
Chapter 15 Slide 5 Stocks Versus Flows ◼ Stock ⚫ Capital is a stock measurement. ◆The amount of capital a company owns