Financial Economics 2nd Edition
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- Publisher : Pearson College Div; 2nd edition (February 15, 2008)
- Language : English
- Hardcover : 500 pages
- ISBN-10 : 0131856154
- ISBN-13 : 978-0131856158
- Item Weight : 2.43 pounds
- Dimensions : 8.25 x 0.85 x 10.25 inches
- Best Sellers Rank: #1,468,267 in Books (See Top 100 in Books)
- Customer Reviews:
Top reviews from the United States
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KEY TOPICS: Encompasses all subfields of finance within a single unifying conceptual framework. Offers the "big picture" of resource allocation over time under conditions of uncertainty. Focuses on personal finance topics, such as saving and investing, as well as asset valuation. Provides spreadsheet modeling exercises in the accompanying Prentice Hall Finance Center CD.
MARKET: Ideal for executives or for anyone seeking a solid understanding and overview of the field of finance.
This book covers the fundamentals in a way that is cohesive, coherent and engagingly constructed. The prose sets the right tone; the math that is used remains in service of the point being made without overshadowing; the short inline anecdotes reinforce the themes and make for an entertaining read. Having taught both undergraduate and graduate courses on investments, I like this book on the strengths of its fundamentals.
The real value of the book, over many other intro books, is the material that goes beyond the compulsory. For example, chapter 5 covers the investment problem at the fundamental level of the choice between saving and consumption; a pet peeve of mine is when investments texts ignore the *purpose* of the portfolio. Chapter 16 covers options in a way that is accessible and correct; again here the math is the servant, but not the master, of the ideas promulgated. Finally, Chapter 17 on real options comprises the last chapter that any course syllabus has as an aspirational goal; well written and informative, students will *want* to read this chapter even if the course ends too soon.
In short, this is a great book to have, read and use.
While another review bemoans the lack of formulas in the chapters (I believe the formulas were well explained), I loved that the book went so far as to explain with examples how to use Microsoft Excel's financial functions to perform all necessary calculations. For my students (who are from the arts and sciences, not the school of engineering) clear instructions on using Excel is a more important benefit than more algebra.
In my experience, most introductory finance texts have too much of a corporate finance worldview. Financial Economics is a more balanced toward the needs of individuals making decisions. Without compunction, I recommend this text for introductory finance classes.
While working through this text for a distance education course, I am finding it a difficult and presumptuous book which introduces concepts and formulas without any explanation as to what the parts mean. Seemingly from out of nowhere, numbers are thrown into formulas without explanation of their meaning or even where they come from. The end of chapter questions are of extreme difficutly at times, trying to trick and outsmart you rather than re-enforcing concepts. Expectation of previous knowledge of the workings of financial concepts and markets make parts of this text impossible to understand without outside help.
For an introductory text, this one does an extremely poor job of explaining the concepts. From the perspective of a student and not a professor to whom these concepts should be elementary, this is a difficult and poorly geared text that is nowhere near "high-school level."
Top reviews from other countries
Definition of the Fin system
Resource allocation and investment projects
Risk management includindg hedging, insuring, diversifying, portfolio management
All of these are very general in nature. This book would be suitable for a student who has no prior experience with finance but not for an advanced student with some finance exposure already.