Browsing by Subject "Inflation (Finance)."

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    Evaluating probabilistic forecasting accuracy of exchange rates
    (1996) Öztin, Şule
    This study aims to explore various dimensions of probabilistic forecasting accuracy. In particular, the effects of using dichotomous format on the performance of semi-experts’ and novices’ probabilistic forecasts of exchange rates and currencies are examined. Semiexperts are comprised of banking and finance professionals in the finance sector. Novice group consists of MBA students from the Faculty of Business Administration at Bilkent University. The results suggest that the dichotomous format used to elicit the probabilistic forecasts has a differential effect on the p>erformance of semi-experts and novices. Implications of these findings for financial forecasting are discussed and directions for future research are given.
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    A qualitative research on consumer's perception of prices and their evaluation of price promotions in an inflationary environment
    (1996) Şahin, F. Aykut
    This study aims at the formation of an understanding on how consumers process price information, what opinion they hold of price promotions and how they interpret promotion signals, reference effects of price promotions, and price and quality perception relationsip in an inflationary environment through the use of qualitative research. The findings are presented and areas of future research are suggested.
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    Rare events and news in a rational expectations economy
    (2003) Köseoğlu, Elif
    We examine the effect of inflation risk on a rational expectations monetary economy with endogenous production. The risk that we consider is of a change in the rate money growth from an initial steady-state level to a new level which is selected from a known distribution. The event of policy change is considered to be rare. The inclusion of rare events means that rational expectations does not require deviations of actual from expected inflation to be of zero mean or to be serially uncorrelated. We view the probability of a policy change, and the distribution of ensuing policy parameters as potentially changing over time. This highlights the role of News in determining the equilibrium of the economy. In the absence of any actual real or monetary shocks, changes in the perception about the likelihood and severity of a rare event have price, real and distributional effects. We find that inflation risk has price, real, and distributional effects.A risk of higher inflation increases the equilibrium price level and nominal interest rates. Inflation risk induces an increase in capital investment and production, and reduces the steady-state rate of return on equity. If the policy does not actually change, the ex-post real interest rate increases. The change in rates of return leads to a redistribution of wealth away from borrowers of nominal instruments towards lenders. Also we find that the theoretical second moment of future money growth has (almost) no effects on the economy.