More on Bitcoin specifically and cryptocurrencies generally…

For more information concerning Bitcoin (other than the Motley Fool articles that I posted a few minutes ago), I recommend reading the Wikipedia article at Technically, Bitcoin is an “application” of so-called “Blockchain” technology. Of course, I wish that I would have had the foresight to have purchased (for that matter, even “mined”) Bitcoin starting back in 2009, but such is the nature of uncertainty – what may seem  “obvious” now seemed borderline silly back then.

The level of volatility in Bitcoin spot and futures prices can be quite breathtaking at times.  Indeed, daily volatility of Bitcoin is roughly ten times the daily volatility of the SP 500 stock index (see WSJ Daily Shot, 11-January-2018). While there may be some entertainment value in buying and selling cryptocurrencies in the spot and futures markets, these instruments are clearly not suitable for most  investors.

For more on Blockchain, I recommend watching either NYU finance professor David Yermack (cf. or Duke finance professor Cam Harvey (cf. – they are the best of the best finance experts on this topic.

Updating of the Finance 4335 Course Schedule to Accommodate today’s “Icepocalypse”

Since Baylor University is closed today as a result of today’s “Icepocalypse”, I have updated the Spring 2018 Finance 4335 Course Schedule accordingly.  The net effect of today’s class cancellation is that the schedule for the remainder of the semester has been shifted forward; consequently, Problem Set 1 is now due on Thursday, January 18 (instead of today), and the two midterm exams will now take place on Thursday, February 15 and Tuesday, April 3 (instead of 2/13 and 3/29).  Thursday’s class will begin with a quiz based upon the assigned readings for our statistics tutorial. The readings, problem sets, and lecture notes pages have also been updated to reflect the fact that Finance 4335 is now officially scheduled to meet 29 rather than 30 times during the Spring 2018 semester.

Problem Set 1 hint…

Problem Set 1 is due at the beginning of class on Tuesday, January 16. Here is a hint for solving the 4th question on problem set 1.

The objective is to determine how big a hospital must be so that the cost per patient-day is minimized. We are not interested in minimizing total cost; if this were the case, there would be no hospital because marginal costs are positive, which implies that total cost is positively related to the number of patient-days.

The cost equation C = 4,700,000 + 0.00013X2 tells you the total cost as a function of the number of patient-days. This is why you are asked in part “a” of the 4th question to derive a formula for the relationship between cost per patient-day and the number of patient days. Once you have that equation, then that is what you minimize, and you’ll be able to answer the question concerning optimal hospital size.

Extra Credit Opportunity

I have decided to offer the following extra credit opportunity for Finance 4335. You can earn extra credit by attending and reporting on Dr. Richard Vedder’s upcoming lecture entitled “Can Markets Improve College Education and Make it More Affordable”:

Thursday, January 18
Foster 250 @ 4:00 pm
Richard Vedder: Distinguished Professor of Economics at Ohio University // Adjunct Scholar at American Enterprise Institute
Talk Title: “Can Markets Improve College Education and Make it More Affordable”

If you decide to take advantage of this opportunity, I will use the grade you earn to replace your lowest quiz grade in Finance 4335 (assuming that your grade on the extra credit is higher than your lowest quiz grade).  The report should be in the form of a 1-2 page executive summary in which you provide a critical analysis of Dr. Vedder’s lecture.  In order to receive credit, the report must be submitted via email to in either Word or PDF formats by no later than Monday, January 22 at 5 p.m.

How to know whether you are on track with Finance 4335 assignments

At any given point in time during the upcoming semester, you can ensure that you are on track with Finance 4335 assignments by monitoring due dates which are published on the course website. See for due dates pertaining to reading assignments, and for due dates pertaining to problem sets. Also keep in mind that short quizzes will be administered in class on each of the dates indicated for required readings. As a case in point, since the required readings entitled “Optimization” and ” How long does it take to double (triple/quadruple/n-tuple) your money?” are listed for Thursday, January 11, this means that a quiz based upon these readings will be given in class on that day.

Important assignments due on the second class meeting of Finance 4335 (scheduled for Thursday, January 11) include: 1) filling out and emailing the student information form as a file attachment to, 2) subscribing to the Wall Street Journal, and 3) subscribing to the course blog. A completed Student information form is graded as a problem set and receives 100 points; if you don’t turn in a Student information form, then you will receive a 0 for this “problem set”. Furthermore, tasks 2 and 3 listed above count toward your class participation grade in Finance 4335.

Finance 4335