金融学第二版讲义大纲及课后习题答案详解第七章.docx

CHAPTER 7 PRINCIPLES OF ASSET VALUATION Objectives ? Understand why asset valuation is important in finance. ? Explain the Law of One Price as the principle underlying all asset-valuation procedures. ? Explain the meaning and role of valuati on models. ? Explain how in formatio n gets reflected in security prices. Outline The Relation Between an Asset s Value and Its Price Value Maximizati on and Finan cial Decisi ons The Law of One Price and Arbitrage Arbitrage and the Prices of Finan cial Assets Excha nge Rates and Trian gular Arbitrage In terest Rates and the Law of One Price Valuati on Using Comparables Valuatio n Models Accou nti ng Measures of Value How Information Gets Reflected in Security Prices The Efficie nt Markets Hypothesis Summary In finance the measure of an asset s value is the price it would fetch if it were sold in a competitive market. The ability to accurately value assets is at the heart of the discipline of finance because many personal and corporate finan cial decisi on s can be made by select ing the alter native that maximizes value. The Law of One Price states that in a competitive market, if two assets are equivale nt they will tend to have the same price. The law is en forced by a process called arbitrage , the purchase and immediate sale of equivale nt assets in order to earn a sure profit from a difference in their prices. Even if arbitrage cannot be carried out in practice to enforce the Law of One Price, unknown asset values can still be in ferred from the prices of comparable assets whose prices are known. The quantitative method used to infer an asset s value from information about the prices of comparable assets is called a valuation model. The best valuation model to employ varies with the information available and the inten ded use of the estimated value. The book value of an asset or a liability as reported in a firm s financial statements often differs from its current market value. In making most financial decisions, it i