CAPM and Fama French Coursework Example | Topics and Well Written Essays - 2250 words

CAPM and Fama French - Coursework Example The report uses the Eviews for the data analysis and hypothesis testing for CAPM & FAMA French Model (Dougherty, 2011) The paper is bifurcated into two parts. Part 1 is based on the test of Capital Asset Pricing Model and Fama French Model using the factors for US stocks for the period of 1963 to 2013. Part 2 of the report is based on the audit fees to evaluate whether the firm characteristics explain the cost of audit or not. The capital asset pricing model is referred to as the model that describes the relationship between the risk and return, which determines the appropriate required rate of return on assets. (Sharifzadeh, 2010) The formula for capital asset pricing model is as follows Βi = Beta , which refers to as the sensitivity of the risk premium to the expected return. The risk premium is referred to as the excess ret urn of the market over the risk free return .i.e. (E (Rm) – Rf) Fama & French model is referred to as the extension of capital asset pricing model. The model adds the size and value factors in addition to the market risk factor in capital asset pricing model. The model considers the fact that whether the small cap stocks and value stocks outperform markets on regular basis. This is the reason; Fama French model is referred to as the three factor model. (Bodie, et al., 2009) The section of the report identifies the fact that why should we test CAPM and Fama French Model? The answer is that the CAPM is used to assess the impact on expected return on asset exclusively by the movement in market risk premium. The CAPM gives an ideal situation of how to price securities that are traded in financial markets to determine the expected return on asset. The major reason to use the CAPM model is that the model gives the objective nature of cost of equity, which the model can yield. (Besley & Brigham, 2007) The Fama French model supplements the CAPM model to further evaluate the cost of equity in terms of return on

Education Philosophy and Rationale Essay Example | Topics and Well Written Essays - 1250 words

Education Philosophy and Rationale - Essay Example Multiple Intelligences as a Personal Education Philosophy On a personal perspective, the theory of Multiple Intelligences (MI) by Howard Gardner is the main basis of teaching philosophy. This is one the basis of the recognition of the capabilities of the students in terms of achieving the basic objectives of the teaching and learning process. The theory of Multiple Intelligences can be considered essential as a guide in enabling the educator to recognize the needs of the students in terms of learning. Metaphysics of MI Multiple Intelligences is one of the educational theories which serve as guiding principles in education. The basic knowledge which became the foundation of the theory originated from the two streams of the research conducted by Howard Gardner in 1970, the Project Zero. He also wrote the â€Å"Frame of Mind† in 1983 based on the said research. Gardner’s view is based on biological perspective mainly the collection of cognitive competences which originally was seven and became nine distinct concepts. His theory mainly explored the manner by which human intelligence works in terms of analyzing and the context by which such frames of mind were exhibited (Dixon & McPhee, n.d.). Epistemology of MI The theory of MI, according Gardner, was based on the consideration of the educational philosophers’ views before him. ... ization, work with brain damaged patients, gifted children and other form or conditions which can cause variation in terms of intelligence on the basis of Gardner’s definition. The second foundation of the theory of MI is the relationship of between the forms of intelligences to the human cultural contexts considered to trigger or to exhibit them (Dixon & McPhee, n.d.). There are different forms of intelligences included in Gardner’s theory namely spatial, linguistic, logical-mathematical, bodily-kinesthetic, musical, interpersonal, intrapersonal and naturalistic forms (Slavin, 2008). Linguistic Intelligence. One of the main forms of intelligence is related to the verbal aspect of development or the linguistic intelligence. Included in the said form are the spoken or written words and other faculties of language. The main contexts of linguistic intelligence are reading, writing, telling stories, vocabulary and memorization of words and dates. Strengths include reading, taking notes, listening to lectures, discussion and debate, and learning new languages (Slavin, 2008). It is one of the basic forms of intelligence based on Gardner which according to him can be observed in the â€Å"work and vision of a poet† (Dixon & McPhee, n.d.). Musical Intelligence. The musical intelligence is also referred to as rhythmic intelligence because it is related to pith rhythm and timbre. Based on data gathered by Gardner, the musical ability is distinct from other forms of intelligence, thus, students can be motivated through music-related activities. Also included in the strengths of musical intelligent learners are drama and role playing (Dixon & McPhee, n.d.). Spatial intelligence. One of the forms of intelligence is spatial intelligence which arms a person to comprehend the world