Physics307L:Labs/Finance

Steve Koch 02:05, 7 October 2008 (EDT):I floated the idea today of having students spend one lab (two sessions) on some kind of finance / economics data analysis and presentation lab. I think students seemed very interested in this, and I think we should try to set it up before next week.

Initial thoughts

• Part of lab should be learning how to calculate net present value (NPV) of future cash flows
• What originally struck me was the need for students to learn where to find economic / government data (such as IRS revenue data; unemployment numbers; GDP; inflation; census; etc.), and being able to crunch the numbers themselves instead of relying on media and politicians.
  • I want to do this without injecting politics, as much as possible. I think that should be achievable if both student and instructor have that goal.
  • A goal is to find primary sources of information, and develop ways of assessing the reliability of the information and the underlying assumptions.
• Darrell Bonn had a related good idea of having students re-analyze data from a published paper. I like this idea, but am not sure (a) whether it fits in this lab and (b) how to narrow the scope or make sure it's worthwhile without picking the paper for the student.
• While this won't have anything to do with modern physics, I think the net benefit to student will be positive. First, the practical skills learned will be very useful, I think. Second, the analysis, number-crunching techniques will be applied things they are learning in 307L.