Lecture 2B: The Meaning of Interest Rates

Yield to Maturity Formulas

1. Yield to Maturity - Simple Loan

- For simple loans, the simple interest rate = yield to maturity.

2. Yield to Maturity - Fixed-Payment Loan

Note:
- When inputting the percentage on the online texas ba ii financial calculator,
instead of using 0.07, use 7 only since it’s 7% not 0.07%
3. Coupon Bond

4. Coupon Bond - Consol or Perpetuity

5. Yield to Maturity - Discount Bond
 Lecture 2C: The Behavior of Interest Rates

1. The return on a bond held from time t to time t + 1

2. Calculating Real Interest Rates

Lecture 3A - The Money Supply Process
Control of the Monetary Base
- MB = Currency in circulation + Reserves (MB = C + R)

Overview of the Fed’s Ability to Control the Monetary Base

Multiple Deposit Creation: A Simple Model