金融考研复试专业英语(终极版)

1、专业英语汇总1. How to define the aggregate price level? 如何衡量价格指数？Three measures of the aggregate price level are commonly encountered in economic data. (1)The first is the GDP deflator (GDP平减指数), which is defined as nominal GDP divided by real GDP. (2)Another popular measure of the aggregate price level i

2、s the Producer Price Index (生产者价格指数) which is a measure of the cost of a basket of goods and services bought by firms.(3) The measure of the aggregate price level that is most frequently reported in the press is the Consumer Price Index (消费者价格指数), which is measured by pricing a basket of goods and s

3、ervices bought by a typical urban household.2. Whats the disadvantage and advantage of holding equity rather than debt? 持有股权的优劣？(1)The main disadvantage of owning a corporations equities rather than its debt is that an equity holder is a residual claimant (剩余求偿权), that is, the corporation must pay a

4、ll its debt holders before it pays its equity holders . (2)The main advantage of holding equities is that equity holders benefit directly from any increases in the corporations profitability or asset value because equities confer ownership rights on the equity holders. Debt holders do not share in t

5、his benefit, because their payments are fixed.3. Whats the difference between primary and secondary market? 一级市场与二级市场的区别？(1)A primary market is a financial market in which new issues of a security, such as a bond or a stock, are sold to initial buyers by the corporation or government agency borrowin

6、g the funds.(2)A secondary market is a financial market in which securities that have been previously issued can be resold.4. Whats the difference between foreign bond and Eurobond? 外国债券和欧洲债券的区别？(1)Foreign bonds are sold in a foreign country and are denominated in that countrys currency. For example

7、, a bond issued by a Chinese company denominated in U.S. dollars sold in New York.(2)Eurobond is a bond denominated in a currency other than that of the country in which it is sold. For example, a bond denominated in U.S. dollars sold in China.5. Whats asset transformation and diversification？资产转换和分

8、散化(1)Financial intermediaries create and sell assets with risk characteristics that people are comfortable with, and the intermediaries then use the funds they acquire by selling these assets to purchase other assets that may have far more risk. This process of risk sharing is referred as asset tran

9、sformation, because in a sense, risky assets are turned into safer assets for investors.(2)Diversification entails investing in a portfolio of assets whose returns do not always move together with the result that overall risk is lower than for individual assets. It also refers to “You shouldnt put a

10、ll your eggs in one basket”. Diversification can eliminate firm-specific riskthe uncertainty associated with the specific companies. But diversification cannot eliminate market riskthe uncertainty associated with the entire economy, which affects all companies traded on the stock market. For example

11、, when the economy goes into a recession, most companies experience falling sales, profit and low stock returns. Diversification reduces the risk of holding stocks, but it does not eliminate it.6. Explain the following concepts: asymmetric information, adverse selection and moral hazard.(1)Asymmetri

12、c information (信息不对称) refers to that one party often does not know enough about the other party to make accurate decisions. For example, a borrower who takes out a loan usually has better information about the potential returns and risk associated with the investment projects for which the funds are

13、 invested than the lender does.(2)Adverse selection (逆向选择) is the problem created by asymmetric information before the transaction occurs. Adverse selection in financial markets occurs when the potential borrowers who are the most likely to default are the ones who most actively seek out a loan and

14、are thus most likely to be selected.(3)Moral hazard (道德风险) is the problem created by asymmetric information after the transaction occurs. Moral hazard in financial markets is the risk that the borrower might engage in activities that are undesirable from the lenders point of view, because they make

15、it less likely that the loan will be paid back. 7. Whats the function of money? 货币的职能？Money has three primary functions in any economy: as a medium of exchange, as a unit of account, and as a store of value.(1)When money is used to pay for goods and services, it plays the role of a medium of exchang

16、e (流通手段). The use of money as a medium of exchange promotes economic efficiency by minimizing the time spent in exchanging goods and services.(2)The second role of money is to provide a unit of account (价值尺度), that is, it is used to measure value of goods and services in the economy.(3)Money also fu

17、nctions as a store of value (储藏手段). A store of value is used to save purchasing power from the time income is received until the time it is spent. This function of money is useful, because most of us do not want to spend our income immediately upon receiving it, but rather prefer to wait until we ha

18、ve the time or the desire to shop.8. Whats the Fisher equation and Fisher effect? 费雪等式与费雪效应？(1)The Fisher equation states that the nominal interest rate equals the real interest rate plus the expected rate of inflation. The equation tells us that all else equal, a rise in a countrys expected inflati

19、on rate will eventually cause an equal rise in the nominal interest rate. Similarly, a fall in the expected inflation rate will eventually cause a fall in the nominal interest rate.(2)This long-run relationship between inflation and interest rates is called the Fisher effect. The Fisher effect impli

20、es, for example, that if U.S. inflation were to rise permanently from a constant level of 5 percent per year to a constant level of 10 percent per year, dollar interest rates would eventually catch up with the higher inflation, rising by 5 percentage points per year from their initial level. These c

21、hanges would leave the real rate of return on dollar assets unchanged. The Fisher effect is therefore another example of the general idea that in the long run, purely monetary developments should have no effect on an economys real variables.9. How to explain the negative relation between the quantit

22、y of money demanded and the interest rate?We can explain that the quantity of money demanded and the interest rate should be negatively related by using the concept of opportunity cost (机会成本), the amount of revenue sacrificed by taking one course of action rather than another. As the interest rate o

23、n bonds rises, the opportunity cost of holding money rises, thus money is less desirable and the quantity of money demanded must fall.10. Risk Premium 风险溢价The spread between the interest rates on bonds with default risk and default-free bonds, both of the same maturity, called the risk premium, indi

24、cates how much additional interest people must earn to be willing to hold that risky bond.11. Briefly introduce expectations theory, segmented markets theory and liquidity premium theory.(1)The expectations theory (预期假说) of the term structure states the following proposition: the interest rate on a

25、long-term bond will equal an average of the short-term interest rates that people expect to occur over the life of the long-term bond.(2)The segmented markets theory (市场分割假说) of the term structure sees markets for different-maturity bonds as completely separate and segmented. The interest rate for e

26、ach bond with a different maturity is then determined by the supply of and demand for that bond, with no effects from expected returns on other bonds with other maturities.(3)The liquidity premium theory (流动性溢价假说) of the term structure states that the interest rate on a long-term bond will equal an

27、average of short-term interest rates expected to occur over the life of the long-term bond plus a liquidity premium. It is also called preferred habitat theory (偏好停留假说).12. Whats the difference between adaptive expectation and rational expectation? (1)Adaptive expectation (适应性预期) states that expecta

28、tions form from past experience only and changes in expectations will occur slowly over time as past data change. For example, expectations of inflation is typically viewed as being an average of past inflation rates. So if inflation had formerly been steady at a 5% rate, expectations of future infl

29、ation would also be 5% .(2)Rational expectation (理性预期) can be stated as follows: expectations will be identical to optimal forecasts (the best guess of the future) using all available information. 13. Efficient Market Hypothesis 有效市场假说In finance, the efficient-market hypothesis (EMH) asserts that fi

30、nancial markets are informationally efficient. In consequence of this, one cannot consistently achieve returns in excess of average market returns on a risk-adjusted basis, given the information available at the time the investment is made.There are three major versions of the hypothesis: weak, semi

31、-strong, and strong. The weak-form EMH claims that prices on traded assets (e.g., stocks, bonds, or property) already reflect all past publicly available information. The semi-strong-form EMH claims both that prices reflect all publicly available information and that prices instantly change to refle

32、ct new public information. The strong-form EMH additionally claims that prices instantly reflect even hidden or insider information. Critics have blamed the belief in rational markets for much of the late-2000s financial crisis.123 In response, proponents of the hypothesis have stated that market ef

33、ficiency does not mean having no uncertainty about the future, that market efficiency is a simplification of the world which may not always hold true, and that the market is practically efficient for investment purposes for most individuals.414. “Lemons Problem” 次品问题A particular aspect of the way th

34、e adverse selection problem interferes with the efficient functioning of a market is called “lemons problem”. We can use the used-car market to illustrate this concept. Potential buyers of used cars are frequently unable to assess the quality of the car, that is, they cant tell whether a particular

35、used car is a good car or a lemon (次品). The price that a buyer pays must therefore reflect the average quality of the cars in the market, somewhere between the low value of a lemon and the high value of a good car. The owner of a used car, by contrast, is more likely to know whether the car is a goo

36、d car or a lemon. If the car is a lemon, the owner is more than happy to sell it at the price the buyer is willing to pay, which, being somewhere between the value of a lemon and a good car, is greater than the lemons value. However, if the car is a good car, the owner knows that the car is underval

37、ued at the price the buyer is willing to pay, and so the owner may not want to sell it. As a result of this adverse selection, few good used cars will come to the market. Because the average quality of a used car available in the market will be low and because few people want to buy a lemon, there w

38、ill be few sales. The used-car market will function poorly or even disappear.15. Principal-agent Problem 委托-代理问题Principal-agent problem refers to that the managers in control (the agents) may act in their own interest rather than in the interest of the stockholder (the principals) because the manage

39、rs have less incentive to maximize profits than the stockholder do. The principal-agent problem, which is an example of moral hazard, arises only because a manager has more information about his activities than the stockholder does. So, there is asymmetric information.16. Whats “irrational exuberanc

40、e” proposed by Alan Greenspan? 非理性繁荣Irrational exuberance refers to a phenomenon that asset prices, in the stock market and real estate, are driven well above their fundamental economic values by investor psychology. The result is an asset-price bubble (资产价格泡沫), such as the tech stock market bubble

41、of the late 1990s or the recent housing price bubble in subprime crisis.17. How to solve asymmetric information problems? 如何解决信息不对称的问题？18. Securitization and Subprime mortgage 资产证券化与次级抵押贷款(1)Subprime mortgages are mortgages for borrowers with less-than-stellar credit records.(2)Securitization is the

42、 process of transforming otherwise illiquid financial assets (such as residential mortgages, auto loans, and credit card receivables), which have typically been the main business of banking institutions, into marketable capital market securities.19. Whats time-inconsistency problem? 时间不一致问题The time

43、-inconsistency problem is some thing we deal with continually in everyday life. We often have a plan that we know will produce a good outcome in the long run, but when tomorrow comes, we just cant help ourselves and we deny our plan because doing so has short-run gains. In other words, we find ourse

44、lves unable to consistently follow a good plan over time, and the good plan is said to be time-inconsistent and will soon be abandoned .20. Political Business Cycle 政治经济周期Political business cycle is a process that can be illustrated in the following example. Just before an election, expansionary pol

45、icies are pursued to lower unemployment and interest rates. After the election, the bad effects of these policies, that is high inflation and high interest rates, come home to roost, requiring contractionary policies that politicians hope the public will forget before the next election.21. Whats mon

46、ey multiplier and what are the factors that affect it? 货币乘数及其影响因素？(1)The money multiplier, denoted by m, tells us how much the money supply changes for a given change in the monetary base. The relationship between the money supply, the money multiplier and the monetary base is described by the follo

47、wing equation: M = m MB(2)The money multiplier is a function of the currency ratio set by depositor c, the excess reserves ratio set by banks e, and the required reserve ratio set by the Fed r. The money multiplier m is thus22. What are the tools of monetary policy? 货币政策工具There are three tools of mo

48、netary policy that can be conducted by the central bank, such as open market operations, discount lending and reserve requirements.(1)Open market operations (公开市场操作) are the most important monetary policy tool, because they are the primary determinants of changes in interest rates and the monetary b

49、ase, the main source of fluctuations in the money supply. Open market purchases expand reserves and the monetary base, thereby increasing the money supply and lowering short-term interest rates. Open market sales shrink reserves and the monetary base, decreasing the money supply and raising short-te

50、rm interest rates. Open market operations have four advantages over the other tools of monetary policy: Open market operations occur at the initiative of the Fed, which has complete control over their volume. Open market operations are flexible and precise, and they can be used to any extent. Open m

51、arket operations are easily reversed.Open market operations can be implemented quickly, since they involve no administrative delays.(2)The facility at which banks can borrow reserves from the Fed is called the discount window (贴现窗口). The facility is intended to be a backup source of liquidity for ba

52、nks during financial crisis.The most important advantage of discount policy is that the Fed can use it to perform its role of lender of last resort (最后贷款人). The disadvantage of discount policy is that the decisions to take out discount loans are made by banks and are therefore not completely control

53、led by the Fed.(3)Changes in reserve requirements (法定存款准备金) affect the money supply by causing the money supply multiplier to change. A rise in reserve requirements reduces the amount of deposits that can be supported by a given level of the monetary base and will lead to a contraction of the money

54、supply. A rise in reserve requirements also increases the demand for reserves and raises the federal funds rate. Conversely, a decline in reserve requirements leads to an expansion of the money supply and a fall in the federal funds rate.Reserve requirements have at least three disadvantages: Owing

55、to financial innovation, reserve requirements are no longer binding for most banks, so this tool is much less effective than it once was. Raising the requirements can cause immediate liquidity problems for banks where reserve requirements are binding. Continually fluctuating reserve requirements wou

56、ld also create more uncertainty for banks and make their liquidity management more difficult.23. Law of One Price and Theory of Purchasing Power Parity一价定理与购买力评价理论(1)The law of one price states that if two countries produce an identical good, and transportation costs and trade barriers are very low,

57、 the price of the good should be the same throughout the world no matter which country produces it.(2)The theory of purchasing power parity (PPP) states that exchange rates between any two currencies will adjust to reflect changes in the price levels of the two countries. The theory of PPP is simply

58、 an application of the law of one price to national price levels rather than to individual prices. The statement that exchange rates equal relative price levels is sometimes referred to as absolute PPP (绝对购买力平价). Relative PPP (相对购买力平价) states that the percentage change in the exchange rate between t

59、wo currencies over any period equals the difference between the percentage changes in national price levels.24. Real Exchange Rate 实际汇率The real exchange rate refers to the rate at which domestic goods can be exchanged for foreign goods. In effect, it is the price of domestic goods relative to the price of foreign goods denominated in the domestic currency.