Midterm 2 will be given during class on Tuesday, April 3. This test consists of 4 problems. You are only required to complete 3 problems. At your option, you may complete all 4 problems, in which case I will throw out the problem on which you receive the lowest score.

The questions pertain to topics which we have covered since the first midterm exam. Topics covered include 1) demand for insurance, 2) adverse selection, 3) portfolio/capital market theory, and 4) financial derivatives (calls and puts specifically). I have posted the formula sheet that will appear as the back page of the exam booklet at the following location: http://fin4335.garven.com/spring2018/formulas_part2.pdf.

Tomorrow’s class meeting will be devoted to a review session for the midterm exam. If you haven’t already done so, I highly recommend that you review Problem Sets 5-8 and also try working the Sample Midterm 2 Exam (solutions are also provided) prior to coming to class tomorrow. I will come to class prepared to work through the solutions for Problem Set 8 and the sample exam, as well as address any questions or concerns that y’all may have.