Title of the Thesis. Max Mustermann XX.XX.20XX. Referent: Prof. Dr. Ralf Elsas Betreuer: Maria Musterfrau

Transcription

1 Title of the Thesis Freie wissenschaftliche Arbeit zur Erlangung des Grades eines Bachelor of Science an der Fakultät für Betriebswirtschaft Munich School of Management der Ludwig-Maximilians-Universität München Max Musterma XX.XX.20XX Referent: Prof. Dr. Ralf Elsas Betreuer: Maria Musterfrau

2 Contents List of Tables... II List of Figures... III List of Acronyms... IV List of Symbols... V 1 Introduction Problem Definition Method of Investigation Main Part Section Subsection Subsection Section Conclusion... 5 Appendix A... 7 A.1 The OLS-Estimator in Matrix-Notation... 7 A.1.1 Derivation... 7 A.1.2 Properties... 8 A.2 Black-Scholes-Formula... 8 Bibliography I

3 List of Tables Table 1: This is an example for a table (Citation)... 3 II

4 List of Figures Figure 1: This is an example how a figure might look like (Citation)... 2 III

5 List of Acronyms LMU Ludwig-Maximilians-Universität München IV

6 List of Symbols μμ Mean σσ Standard deviation V

7 1 Introduction 1.1 Problem Definition Deferred compensation which partly depends on the firm s stock performance is generally used to align the personal interests of employees more closely to the interest of shareholders (Scholes (1991)). Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. 1.2 Method of Investigation Scholes (1991) furthermore argues that current tax rules encourage stock performance dependent deferred compensation. Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. 1

8 2 Main Part 2.1 Section Subsection will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. See Figure 1 for further information. Figure 1: This is an example how a figure might look like (Citation) will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. 2

9 will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language Subsection will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. See Table 1. Table 1: This is an example for a table (Citation) will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original lan-guage. There is no need for special content, but the length of words should match the language. Slices abs. error (%) abs. error (slices) avg. max. avg. max. < > will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original lan- 3

10 guage. There is no need for special content, but the length of words should match the language. 2.2 Section will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. VV tt = ii=tt+1 DDiivv tt (1 + rr) ii (1) will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. 4

11 3 Conclusion will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. This is the second paragraph. Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. And after the second paragraph follows the third paragraph. Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. After this fourth paragraph, we start a new paragraph sequence. Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of 5

12 the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. 6

13 Appendix A A.1 The OLS-Estimator in Matrix-Notation A.1.1 Derivation Notation: Let XX be an kk matrix, where kk stands for the number of variables (including the constant term) and stands for the number of observations. Let yy be an 1 vector of observations on the dependent variable Let εε be an 1 vector of effort terms Let ββ be an kk 1 vector of unknown population parameters that need to be estimated The statistical model therefore is: YY 1 1 XX 11 XX 21 XX kk1 ββ 1 YY 2 1 XX = 12 XX 22 XX kk2 ββ 2 εε 2 + YY 1 XX 1 XX 2 XX kkkk ββ εε The vector of residuals ee is given by: yy Therefore the sum of the squared residuals is ee ee Combining (3) and (4) gives 1 : XX ββ εε 1 yy = XXββ + εε (2) ee = yy XXββ (3) ee 1 ee 2 [ee 1 ee 2 ee ] = [ee ee ee 2 ] (4) ee ee ee = yy XXββ yy XXββ = yy yy ββ XX yy yy XXββ + ββ XX XXββ = yy yy 2ββ XX yy + ββ XX XXββ (5) εε 1 Remember that the transpose of a scalar is the scalar, which implies that yy XXββ = yy XXββ = ββ XX yy. 7

14 To find the ββ which minimizes the sum of squared residuals, der derivative of (5) with respect to ββ has to be set equal to zero 2 : ee ee ββ A.1.2 Properties = 2XX yy + 2XX XXββ!=yy yy 2ββ XX yy + ββ XX XXββ (XX XX)ββ = XX yy ββ = (XX XX) 1 XX yy (6) will look like at this place. If you read this text, you will get no information. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. This text should contain all letters of the alphabet and it should be written in of the original language. There is no need for special content, but the length of words should match the language. A.2 Black-Scholes-Formula will look like at this place. sin 2 (αα) + cos 2 (ββ) = 1. If you read this text, you will get no information EE = mmcc 2. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. aa bb = aaaa. This text should contain all letters of the al- phabet and it should be written in of the original language. aa for special content, but the length of words should match the language. aa bb bb = aa. There is no need bb = aa bb. And after the second paragraph follows the third paragraph. Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. sin 2 (αα) + cos 2 (ββ) = 1. If you read this text, you will get no information EE = mmcc 2. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you infor- 2 To check whether this is actually a minimum you have to show that the second derivative with respect to ββ is positive: 2 ee ee = ββ 2 2XX XX > 0 as long as XX has full rank and it is a positive definite matrix. 8

15 mation about the selected font, how the letters are written and an impression of the look. aa bb = aaaa. This text should contain all letters of the alphabet and it should be written in of the original language. aa bb the length of words should match the language. aa bb = aa. There is no need for special content, but bb = aa bb. After this fourth paragraph, we start a new paragraph sequence. Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. sin 2 (αα) + cos 2 (ββ) = 1. If you read this text, you will get no information EE = mmcc 2. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. aa bb = aaaa. This text should contain all letters of the alphabet and it should be written in of the original language. aa bb the length of words should match the language. aa bb = aa. There is no need for special content, but bb = aa bb. will look like at this place. sin 2 (αα) + cos 2 (ββ) = 1. If you read this text, you will get no information EE = mmcc 2. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the selected font, how the letters are written and an impression of the look. aa bb = aaaa. This text should contain all letters of the al- phabet and it should be written in of the original language. aa for special content, but the length of words should match the language. aa bb bb = aa. There is no need bb = aa bb. This is the second paragraph. Hello, here is some text without a meaning. This text should show what a printed text will look like at this place. sin 2 (αα) + cos 2 (ββ) = 1. If you read this text, you will get no information EE = mmcc 2. Really? Is there no information? Is there a difference between this text and some nonsense like \Huardest gefburn"? Kjift { not at all! A blind text like this gives you information about the select- ed font, how the letters are written and an impression of the look. aa bb = aaaa. This text should contain all letters of the alphabet and it should be written in of the original 9

16 language. aa bb match the language. aa bb = aa. There is no need for special content, but the length of words should bb = aa bb. 10

17 Bibliography Ang, Andrew, and Geert Bekaert, 1998, Regime switches in interest rates, NBER Working paper 6508, Stanford University. Buchinsky, Moshe, and Oved Yosha, 1995, Evaluating the probability of failure of a banking firm, Cowles Foundation Discussion paper no. 1108, Yale University. Clarida, Richard, Jordi Gali, and Mark Gertler, 1997, Monetary policy rules and macroeconomic stability; Evidence and some theory, mimeo, Columbia University. Conroy, Robert, Robert S. Harris, and Young Park, 1994, Analysts Earnings Forecast Accuracy in Japan and the United Sates (The Research Foundation of The Institute of Chartered Financial Analysts, Charlottesville). Fama, Eugene F., and Merton H. Miller, 1972, The Theory of Finance (The Dryden Press, Hinsdale, IL). Fischer, Georg, 2011, Aual report 2010 from website, Grossman, Sanford J., and Oliver D. Hart, 1982, Corporate financial structure and managerial incentives, in John J. McCall, ed.: The Economics of Information and Uncertainty (University of Chicago Press, Chicago). Keynes, John Maynard, 1930, A Treatise on Money, Vol. II (Macmillan, London). Livingston, Miles, and Davis Gregory, 1989, The Stripping of U.S. Treasury Securities (Salomon Brothers Center for the Study of Financial Institutions, New York University, New York). Lowenstein, Roger, 1997, Street s incredible unshrinking spread, Wall Street Journal, April 10, C1. Morgenson, Gretchen, 1998, Stock options are not a free lunch, Forbes, May 18. Ongena, Steven, and David C. Smith, 1998, What determines the number of bank relationships? Cross-country evidence, Unpublished manuscript, Norwegian School of Management. Scholes, Myron, 1991, Stock and compensation, Journal of Finance 46,

18 Schwert, G. William, 1993, The Journal of Financial Economics: A retrospective evaluation ( ), Journal of Financial Economics 33, Wright, Brian D., and Jefrey C. Williams, 1989, A theory of negative prices for storage, Journal of Futures Markets 9,

19 Ehrenwörtliche Erklärung Ich erkläre hiermit ehrenwörtlich, dass ich die vorliegende Arbeit selbständig angefertigt habe; die aus fremden Quellen direkt oder indirekt übernommenen Gedanken sind als solche ketlich gemacht. Die Arbeit wurde bisher keiner anderen Prüfungsbehörde vorgelegt und auch noch nicht veröentlicht. München, XX.XX.20XX Datum Unterschrift 13