TEL> Vol.2 No.2, May 2012

The Policy Role in the Stock Markets

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ABSTRACT

This note is an attempt to model the role of the policymaker in stabilizing the stock markets. In doing so, we present an elasticity formula that links the risk-free interest rate to the value of the stock index.

Cite this paper

M. Alghalith, E. Ramlogan and M. Franklin, "The Policy Role in the Stock Markets," Theoretical Economics Letters, Vol. 2 No. 2, 2012, pp. 230-231. doi: 10.4236/tel.2012.22042.

References

[1] M. Alghalith, “General Closed-Form Solutions to the Dynamic Optimization Problem in Incomplete Markets,” Applied Mathematics, Vol. 2, No. 4, 2011, pp. 433-435. doi:10.4236/am.2011.24054
[2] S. E. Shreve and H. M. Soner, “Optimal Investment and Consumption with Transaction Costs,” The Annals of Applied Probability, Vol. 4, No. 3, 1994, pp. 609-692. doi:10.1214/aoap/1177004966
[3] G. Yin and X. Y. Zhou, “Mean Variance Portfolio Selection under Markov Regime: Discrete Time Models and Continuous Time Limits,” Proceedings of the 15th International Symposium on Mathematical Theory of Networks and Systems, Leuven, 5-9 July 2000, pp. 1-6.
[4] J. Cvitanic and F. Zapatero, “Introduction to the Economics and the Mathematics of Financial Markets,” MIT Press, Cambridge, 2004.

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