Difference between capitalization and their book value
Is the difference for the value creation in a company among the market value of the shares (capitalization) and their book value a good measure since its foundation?
Expert
No. Value creation in an era is the difference between the return to shareholders and the needed return multiplied by the capitalization at the starting of the period.
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1 Assume the following (all rates are stated annually with semiannual compounding) a. Six Month Spot Rate is 2% b. Six Month Forward rate starting at month six is 2.2% c. Six Month Forward rate starting at month 12 is 2.4% d. Six Month Forward rate starting at mont
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