« Mortgages | Main | Interpretting Regression Estimates »
February 03, 2009
Stocks
Our first theory sounds good, but is a little too general:
Our second attempt at a theory does not explain the data on prices and dividends very well:
Accounting for expected growth in dividends produces a much more realistic model.
A lemma:
An alternative model:
Posted by bparke at February 3, 2009 10:38 PM