Chapter Seven - General Valuation Model

Bond Valuation

1. Terminology
2. Basic Bond Valuation Model
3. Changes in Bond Valuation Over Time
4. Finding the Promised Yield on a Bond
5. Bond Values with Semiannual Compounding
6. Bond Yields and Bond Markets

Preferred Stock Valuation

1. Valuation of a Perpetuity

Common Stock Valuation

1. Expected Dividends (Earnings)
2. Zero growth stock
3. Normal or Constant Growth
4. Expected Rate of Return on a Constant Growth Stock

Stock Market Equilibrium

1. Changes in Equilibrium Stock Prices
2. The Efficient Markets Hypothesis
3. Levels of Market Efficiency
4. Actual Stock Prices and Returns
5. Stock Market Reporting