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As of March 25, 1998
- p. 20 Questions 6, 7, 8, and 9
were omitted from the list. These questions are listed below.
6. Why would knowledge about the determinants of prices, the nature
of price changes, the nature of price relationships among financial market,
and pricing efficiency be important for setting the policies of individuals
or corporations?
7. Why would knowledge about the determinants of prices, the nature
of price changes, the nature of price relationships among financial market,
and pricing efficiency be important for setting national and international
financial policies?
8. Why might international financial markets be very important to a
small country, like Portugal or Korea?
9. "Over the last 50 years, international financial markets have
become more important to the United States." True or false? Explain.
- p. 65 Title of Chapter 7
is "Foreign Exchange Market Efficiency"
- p. 82 Under "Synthetic DM Securities"
the fourth line down should read "line segment BC."
- p. 96 In Exercise #10b, the 8%
interest rate is on a per annum basis.
- p. 102 Missing right parenthesis in
line 7 after "weights Wi "
- p. 153 Footnote 28. Reference to
Table 5.4 should read "Table 5.2" and reference to Table 5.3
should read "Table 5.1."
- p. 155 In the right-hand column
of Box 5.2 the two mathematical expressions have been reversed. The cost
of path 1 is 0.6810 $/DM / (1 + 0.060625/12) = 0.6776 $/DM; and the cost
of path 2 is 0.6803 $/DM / (1 + 0.04000/12) = 0.6780 $/DM .
- p. 181 In Figure 6.6, on the right
side of the diagram under the "Monetary Approach", the line of
text after the second arrow should read: i - i* =
E(s) . The final "(s)" was omitted.
- p. 181 In the fourth line of text,
the word "are" should be "is"
- p. 208 In Appendix 6.3, at the top of
the right-hand column, the symbols "epsilon (i-i*)"
are all an exponent of "e"
- p. 214 The final full paragraph on this
page should begin "Recall our discussion of the International Fisher
Effect ..."
- p. 216 The correct wording at the
beginning of Box 7.1 shold read: "In this experiment, we generated
200 normally distributed random numbers (ut, t
= 1, ... 200) using the random number generator in EXCEL and placed
the numbers in Column A of a spreadsheet. This can be done by clicking
on the "TOOLS" menu and the "DATA ANALYSIS" and
the "Random Number Generation."
- p. 240 The footnote at the bottom
of the page should read: "Data for this exercise are provided
on disk." And the reference to Figure 7.5 in Question 1 should be
"Figure 7.4."
- p. 241 The footnote at the bottom
of the page should read: "Data for this exercise are provided
on disk." And the reference to Figure 7.5 in Question 2 should be
"Figure 7.4."
- p. 255 Figure B. The labels
for the five curves in Figure B represent phi = 1.0, 0.99, 0.95, 0.90,
and 0.80 respectively reading from top to bottom. The lines should be drawn
to match the legend at the bottom of the Figure.
- p. 309 Exercise #2, last sentence
should read ".... over the next five months."
- p. 311 The date (1988) should
appear after the quotation from Frederick G. Fisher III.
- p. 340 Figure 10.7. The title
of this figure should read "Yield Spread: Regular U.S. Treasury Note
Minus Specially Targeted U.S. Treasury Note."
- p. 425 In Box 12.2, the title
of the graph should read: "One-Month Risk Reversal US$/Yen"
- p. 439 In Figure 12A.1, in
the title of each graph, the term "rf" should use
the lower case "r"
- p. 467 Below Figure 13.7a,
should include "Source: Simons (1989)"
- p. 497 Formula (14.5) has
an error. The "epsilon" term could be negative and it is
not possible to take the logarithm of a negative number. To see a correction
for this error, click on the highlighted text Page
497 correction.
- p. 571 One line below the section
header "The Range of Firms Facing Exchange Rate Exposure,"
and in the same line as the section header "The Time Dimension
of Exposure" the partial derivative "delta MV/delta Spot"
appears. The word "Spot" was not printed.
- p. 635-6 The questions are not
numbered properly in sequence. There are 15 questions, not 16. The question
marked #4, should be numbered as #3, and so on.
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