SInvestment Decision vs. Financing Decision OMarket Efficiency →Weak form efficiency →Semi -strong- form efficiency >Strong form efficiency OLessons of Market Efficiency Irwvin/McGraw-Hill
Market Portfolio-Portfolio of all assets in the economy. In practice a broad stock marke index, such as the S&P Composite, is used to represent the market. Beta- Sensitivity of a stock's return to the return on the market portfolio
Topics Covered SHow Firms Organize Their Investment Process Some\What If Questions Sensitivity analysis Break Even Analysis SFlexibility in Capital Budgeting Decision Trees Options
Topics Covered Stocks and the Stock Market Book Values. Liquidation Values and Market values Valuing Common Stocks Simplifying the Dividend Discount Model Growth Stocks and Income Stocks Irwvin McGraw-Hill