Search results
Results from the WOW.Com Content Network
Using this methodology, the model closely mimics many business cycle properties. Yet current RBC models have not fully explained all behavior, and neoclassical economists are still searching for better variations. The main assumption in RBC theory is that individuals and firms respond optimally over the long run.
Two schools of analysis form the bulk of DSGE modeling: [note 4] the classic RBC models, and the New-Keynesian DSGE models that build on a structure similar to RBC models, but instead assume that prices are set by monopolistically competitive firms, and cannot be instantaneously and costlessly adjusted.
BHCs possess adequate capital. The capital structure is stable given various stress-test scenarios. Planned capital distributions, such as dividends and share repurchases, are viable and acceptable in relation to regulatory minimum capital requirements. The assessment is performed on both qualitative and quantitative bases.
Moody's Investors Service, ("Moody's") assigned a Baa3 (hyb) rating to Royal Bank of Canada's (RBC) issuance of additional tier 1 (AT1) structure limited recourse notes. The rating on the AT1 ...
The Calvo model has become the most common way to model nominal rigidity in new Keynesian models. There is a probability that the firm can reset its price in any one period h (the hazard rate), or equivalently the probability (1 − h) that the price will remain unchanged in that period (the survival rate).
Economic capital is a function of market risk, credit risk, and operational risk, and is often calculated by VaR. This use of capital based on risk improves the capital allocation across different functional areas of banks, insurance companies, or any business in which capital is placed at risk for an expected return above the risk-free rate.
The capital asset pricing model (CAPM) is a financial model used to determine a security’s expected return considering its associated risk. Developed in the 1960s, CAPM has become an essential ...
An affine term structure model is a financial model that relates zero-coupon bond prices (i.e. the discount curve) to a spot rate model. It is particularly useful for deriving the yield curve – the process of determining spot rate model inputs from observable bond market data.