Individuals and institutions have different income streams and different intemporal consumption preferences(个体和组织的收入来源和跨期消费偏好不同)
Because of this,a market has arisen for money.The price of money is the interest rate(市场出现货币的原因,P(money)=r)
Financial intermediation(金融中介)
Size intermediation
amount of loan
Term intermediation
commercial banks finance long-term mortgages with short-term deposits
Risk intermediation
Financial intermediaries can tailor the risk characteristics of securities for borrowers and lenders with different degrees of risk tolerance(为风险忍受度不同的lender&borrower 量身定制风险不同的证券)
Mkt Clearing(市场出清)
The job of balancing the supply of and demand for loanable funds is taken by the money mkt(用于平衡货币市场上可贷资金的供应和需求量)
When the quantity supplied equals the quantity demanded, the mkts is in equilibrium at the quilibrium price
P(money)=interest rate
4.2 Making Consumption Choices Over Time
An individual can alter his consumption across time periods through borrowing and lending
We can illustrate this by graphing consumption today vs consumption in the future
intertemporal consumption oppprtunities
impatient consumer
patient consumer
interest rates↑,more attractive to save
interest rates↑,less attractive to borrow
4.3The Competitive Market
Trading is costless(交易无成本)
Information about borrowing and lending is available(信息对等且公开)
There are many traders;no individual can move market prices(交易双方都没有定价权)
only one equilibrium interest rate in mkt-or arbitrage
i(borrowing)=i(lending)
4.4The Basic Principle
An investment must be at least as desirable as the opportunities available in the the financial mkts(投资理想)
Practicing the Principal
Illustrating the Investment Decision Making
Net Present Values
how much better off in today's dollar the investment makes us
invest in time 1 (m,r),and get funds at time 2 (1+r)m,NPV=-m+Offered invest return(time 2) /(1+r)
npv>0,unambiguously good(shift the shareholder's opp set out)
Corporate Investment Decision
Shareholders will be united in their preference for the firm to
undertake positive net present value decisions, regardless of their
personal intertemporal consumption preferences(股东一切以公司 NPV>0优先,为此可以放弃个人偏好)
In reality,shareholders do not vote on every investment decision faced by a firm and the managers of firms need decision rules to operate by(公司管理制定规则而不是处处依靠股东)
All shareholders of a firm will be made better off if managers follow the NPV rule-undertake positive NPV projects and reject negative NPV projects.(接受 NPV>0的 project 拒绝<0的 project)
The separation Thorem
all investors will want to accept or reject the same investment projects by using the NPV rule,regardless of their personal preferences(所有的投资者都遵循 NPV 规则,只接受 NPV>0的 project)
Separating investment decision-making from the shareholders is a basic requirement of the modern corporation(股东对 project 的决策最基本的要求)
Summary and conclusions
Financial markets exist because people want to adjust their consumption over time. They do this by borrowing or lending(经融市场的存在是因为人们想通过借贷调整他们的消费)
An investment should be rejected if a superior alternative exists in the financial mkts(当有superior alternative 存在是应该放弃现有投资项目)
If no superior alternative exsits in the financial mks,an investment hasNPV>0(如果不存在更好的 alternative, 那么说明这个投资项目的 NPV>0)