inconsistent with the basic tenets of utility theory. In particular‚ people underweight outcomes that are merely probable in comparison with outcomes that are obtained with certainty. This tendency‚ called the certainty effect‚ contributes to risk aversion in choices involving sure gains and to risk seeking in choices involving sure losses. In addition‚ people generally discard
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BOND PRICING CHAPTER 1 Floating Rate bonds * Floating rate bonds make interest payments that are tied to a measure of current market rates Example: Rate may be adjusted annually to the current T bill rate plus 2% * Major risk involved for floaters is due to the changes in the firm’s financial strength * Yield spread is fixed over life of security however if the firm’s strength deteriorates then investors would demand a greater yield premium * This makes the price of bonds
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Perception Chapter 15 - Taste Taste Versus Flavour Retronasal Olfaction • The sensation of an odour that is perceived when chewing and swallowing forces an odourant in the mouth‚ up behind the palate into the nose. • Such odour sensations are perceived as originating from the mouth‚ even though the actual contact of odourant and receptor occurs at the olfactory epithelium Flavour • The combination of true taste (sweet‚ salty‚ sour‚ bitter) and retronasal olfaction Taste Versus Flavour Retronasal
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Arrow-Pratt measure for approximating local risk premia‚ and its structure reveals whether the decision maker’s risk preferences are ambiguity-averse as well as risk averse. Two versions of the smooth-ambiguity model are analyzed—the source-dependent risk aversion model and the second-order uncertainty (KMM) model—and it is shown that in both cases the overall premium for local uncertainty can be decomposed as the sum of a risk premium and an ambiguity premium. 1 Introduction The urn experiments devised
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Agency Theory: An Assessment and Review Author(s): Kathleen M. Eisenhardt Source: The Academy of Management Review‚ Vol. 14‚ No. 1 (Jan.‚ 1989)‚ pp. 57-74 Published by: Academy of Management Stable URL: http://www.jstor.org/stable/258191 Accessed: 14/10/2010 10:43 Your use of the JSTOR archive indicates your acceptance of JSTOR’s Terms and Conditions of Use‚ available at http://www.jstor.org/page/info/about/policies/terms.jsp. JSTOR’s Terms and Conditions of Use provides‚ in part‚ that unless you
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Suggested Solutions to Sample Midterm #1 Fi 4000—Fall 2014 Problem 1 (20 points) Part A Suppose Mike wants to prepare an amount of money today to support his son’s college education. He expects his son to enter a college in 16 years with annual tuition and expenses of $25‚000 for 4 years. His first college tuition and expenses will due in exactly 16 years from now. Mike decides to put all the money that is required for his son’s college education today at a bank account earning rate of
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’ALL TASTE IS ACQUIRED TASTE. ’ DISCUSS To say that all taste is acquired taste is to say that in expressing a preference for a particular food‚ style of dress or type of music we are expressing an entirely culturally learned system of values. In Western society ’good taste ’ is seen to be the domain of the upper classes. In other words the symbols appropriated by the economically and socially successful are the ones that are ascribed the most worth. Sahlins(1976) argues that the value
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A taste of Piyaway Village‚ home of the Ayatal By Oscar Escobar StudentID 1015453 Nestled in the heart of the central mountains of Taiwan‚ a little and ancient village is fed by the clear sky and the sound of the river flowing. It’s the Piyaway Village‚ home of the Ayatal Tribe. Once you get to there in the Fushsing Township‚ through a snake-back styled road‚ a feeling of peacefulness and quietness will invade your feelings. You will feel attracted by the sounds‚ by the textures‚ by the air
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FINAL EXAM ** Covers exercises 13‚ 14‚ 15‚ 16‚ 17‚ 18‚ 20‚ 21‚ 22‚ 23‚ 24‚ 25‚ 26‚ 27** Terms – Intro to Sensory Receptors (Lab 24) General senses – touch‚ pressure‚ changes in temperature‚ pain‚ blood pressure and stretching Special senses – taste‚ smell‚ sight‚ hearing‚ balance Punctate distribution – uneven distribution of sense receptors Stimuli are classified by type (modalities) such as light‚ heat‚ sound‚ pressure and specific chemicals Receptors – receiving units in the body that respond
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INVESTMENT & PORTFOLIO MANAGEMENT FIN3IPM TUTORIAL ANSWERS TUTORIAL 1: INTRODUCTION CHAPTER 1: QUESTION 1 a The process of investment concerns the purchase of assets which will provide a future return to allow for future consumption or further investment. Individuals have to make choices between current and future consumption and because their pattern of income does not always match their pattern of consumption‚ they are required to make investments. Throughout an individual’s life
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