Need to find a value that can make the equation's value = 0 like Solver in Excel
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From: Patrick on 10 Jul 2010 23:04 "...need to find Ri for each firm/year." If it's firm/year why then isn't it Ri,t? It would be helpful for someone like me if you also could explain what the different literals mean (M, B, ROE,...). I assume ROE is Return on Investment, but what's the rest? Was this formula given to you or did you develop it based on a problem? My unqualified impression is that this is more a question of getting the maths right first.
From: CC on 11 Jul 2010 13:23 Hi Patrick, The formula is a simplified version but I am sure this will not affect the result as my main problem is to find a function to deal with it (I am pretty sure even it is a simplified version, we can still get an answer if we know which function we can use.). And, of course, I will use the complete version of formula to solve this question later. The M and B are the market value and book value, respectively. I did not want to mention it since I will not like to confuse people and want to simply focus on the question itself. And, yes, it should be Ri,t instead of Ri,t. But, if we can find one Ri then the rest is easy relatively. Could you give me some suggestions on how to solve it? Thanks. On Jul 10, 8:04 pm, Patrick <patrick.mat...(a)gmx.ch> wrote: > "...need to find Ri for each firm/year." > If it's firm/year why then isn't it Ri,t? > It would be helpful for someone like me if you also could explain what > the different literals mean (M, B, ROE,...). I assume ROE is Return on > Investment, but what's the rest? > Was this formula given to you or did you develop it based on a > problem? My unqualified impression is that this is more a question of > getting the maths right first.
From: CC on 11 Jul 2010 13:34 On Jul 10, 8:04 pm, Patrick <patrick.mat...(a)gmx.ch> wrote: > "...need to find Ri for each firm/year." > If it's firm/year why then isn't it Ri,t? > It would be helpful for someone like me if you also could explain what > the different literals mean (M, B, ROE,...). I assume ROE is Return on > Investment, but what's the rest? > Was this formula given to you or did you develop it based on a > problem? My unqualified impression is that this is more a question of > getting the maths right first. Hi Patrick, The formula is a simplified version but I am sure this will not affect the result as my main problem is to find a function to deal with it (I am pretty sure even it is a simplified version, we can still get an answer if we know which function we can use.). And, of course, I will use the complete version of formula to solve this question later. The M and B are the market value and book value, respectively. I did not want to mention it since I will not like to confuse people and want to simply focus on the question itself. And, yes, it should be Ri,t instead of Ri. So, your observation is correct. Thanks for that. But, if we can find one Ri then the rest is easy relatively. Could you give me some suggestions on how to solve it? Thanks.
From: Arthur Tabachneck on 11 Jul 2010 16:32 If you only need to solve for one value, couldn't you just a binary- tree-type-search using a do while loop? Art ---------- On Jul 11, 1:34 pm, CC <chchanghe...(a)gmail.com> wrote: > On Jul 10, 8:04 pm, Patrick <patrick.mat...(a)gmx.ch> wrote: > > > "...need to find Ri for each firm/year." > > If it's firm/year why then isn't it Ri,t? > > It would be helpful for someone like me if you also could explain what > > the different literals mean (M, B, ROE,...). I assume ROE is Return on > > Investment, but what's the rest? > > Was this formula given to you or did you develop it based on a > > problem? My unqualified impression is that this is more a question of > > getting the maths right first. > > Hi Patrick, > > The formula is a simplified version but I am sure this will not affect > the result as my main problem is to find a function to deal with it (I > am pretty sure even it is a simplified version, we can still get an > answer if we know which function we can use.). And, of course, I will > use the complete version of formula to solve this question later. The > M and B are the market value and book value, respectively. I did not > want to mention it since I will not like to confuse people and want to > simply focus on the question itself. And, yes, it should be Ri,t > instead of Ri. So, your observation is correct. Thanks for that. > But, if we can find one Ri then the rest is easy > relatively. Could you give me some suggestions on how to solve it? > Thanks.
From: CC on 11 Jul 2010 17:25
On Jul 11, 1:32 pm, Arthur Tabachneck <art...(a)netscape.net> wrote: > If you only need to solve for one value, couldn't you just a binary- > tree-type-search using a do while loop? > > Art > ---------- > On Jul 11, 1:34 pm, CC <chchanghe...(a)gmail.com> wrote: > > > On Jul 10, 8:04 pm, Patrick <patrick.mat...(a)gmx.ch> wrote: > > > > "...need to find Ri for each firm/year." > > > If it's firm/year why then isn't it Ri,t? > > > It would be helpful for someone like me if you also could explain what > > > the different literals mean (M, B, ROE,...). I assume ROE is Return on > > > Investment, but what's the rest? > > > Was this formula given to you or did you develop it based on a > > > problem? My unqualified impression is that this is more a question of > > > getting the maths right first. > > > Hi Patrick, > > > The formula is a simplified version but I am sure this will not affect > > the result as my main problem is to find a function to deal with it (I > > am pretty sure even it is a simplified version, we can still get an > > answer if we know which function we can use.). And, of course, I will > > use the complete version of formula to solve this question later. The > > M and B are the market value and book value, respectively. I did not > > want to mention it since I will not like to confuse people and want to > > simply focus on the question itself. And, yes, it should be Ri,t > > instead of Ri. So, your observation is correct. Thanks for that. > > But, if we can find one Ri then the rest is easy > > relatively. Could you give me some suggestions on how to solve it? > > Thanks. Hi Art, Thanks for your response. But I have one concern about using the do while loop as the Ri I am looking for is around 0 to 1. And the value might have to go to something like 0.0012389654788 in order to solve the equation. So, if I use the do loop to do it, how can I guarantee I find the right value I want, and it might also take really longer than I expect when using do loop? Thanks. |