货币金融学WhatIsMoney教材.pptVIP

Rate of Return and Interest Rates (cont’d) The more distant a bond’s maturity, the lower the rate of return the occurs as a result of an increase in the interest rate Even if a bond has a substantial initial interest rate, its return can be negative if interest rates rise Table 2 One-Year Returns on Different-Maturity 10%-Coupon-Rate Bonds When Interest Rates Rise from 10% to 20% Interest-Rate Risk Prices and returns for long-term bonds are more volatile than those for shorter-term bonds There is no interest-rate risk for any bond whose time to maturity matches the holding period Real and Nominal Interest Rates Nominal interest rate makes no allowance for inflation Real interest rate is adjusted for changes in price level so it more accurately reflects the cost of borrowing Ex ante real interest rate is adjusted for expected changes in the price level Ex post real interest rate is adjusted for actual changes in the price level Fisher Equation FIGURE 1 Real and Nominal Interest Rates (Three-Month Treasury Bill), 1953–2008 Sources: Nominal rates from /releases/H15. The real rate is constructed using the procedure outlined in Frederic S. Mishkin, “The Real Interest Rate: An Empirical Investigation,” Carnegie-Rochester Conference Series on Public Policy 15 (1981): 151–200. This procedure involves estimating expected inflation as a function of past interest rates, inflation, and time trends and then subtracting the expected inflation measure from the nominal interest rate. * * * * * * * * * * * * Copyright ? 2010 Pearson Addison-Wesley. All rights reserved. 3-* Copyright ? 2010 Pearson Addison-Wesley. All rights reserved. Chapter 3 What Is Money? Meaning of Money What is it? Money (or the “money supply”): anything that is generally accepted in payment for goods or services or in the repayment of debts. A rather broad definition Evolution of the Payments System Commodity Money: valuable, easily standardized and divisible commodities (e.g. precious metals, cigarettes)