## Kangle Essay

Measurement of the return on a company stock is an integral part of the market evaluation of the overall performance of the company.  In the absence of dividends, stock splits, or other financial adjustments, the return on a company’s common stock is defined as the change in price during a specified period divided by the price at the start of the month.  Although an examination of monthly returns is usually concerned with monthly data, the concept also applies to information gathered for shorter or longer intervals.

Thus, if a stock’s price at the start of the month is \$50 and it increases to \$51 at the end of the month, the return is (51 – 50)/50 = 0.020, or 2.0 percent.  If it decreases from 51 to 49 the following month, the return is (49 – 51)/51 = -0.039, or –3.9 percent.  Hence, returns over a given period are essentially proportional or percentage changes in price.

Thus, if a stock’s price at the start of the month is \$50 and it increases to \$51 at the end of the month, the return is (51 – 50)/50 = 0.020, or 2.0 percent.  If it decreases from 51 to 49 the following month, the return is (49 – 51)/51 = -0.039, or –3.9 percent.  Hence, returns over a given period are essentially proportional or percentage changes in price.

Here we presents metropolitan statistical area (MSA) projections to the year 2000 of total personal income, per capital personal income, employment, and population. The MSA projections are based on data through 1988; they update the projections based on data through 1983 presented in the October 1985 SURVEY OF CURRENT BUSINESS. These new projections are consistent with the State projections that were presented in the May 1990 SURVEY. (1) The MSA projections are based on an extension of past economic relationships and assume no major policy changes; they are baseline projections. They are neither goals for, nor limits on, future economic activity in any MSA. These projections have three major uses: (1) Assessing future demand for goods and services by households, businesses, and government, (2) analyzing economic trends to anticipate future economic problems, and (3) providing baselines with which to compare policy forecasts in measuring the effects of policies.

The projections were made in four steps. In the first step, the national projections were developed. In the second step, the national projections were distributed among the States according to the historical record of each State’s share of the national totals. In the third step, projections for each State were distributed among substate areas according to the historical record of each substate area’s share of the State totals. In the fourth step, the substate-area projections were summed to arrive at projections for the MSA’s. (2)

Table 1 shows projections for the 336 metropolitan areas recognized as of June 1989 by the Office of Management and Budget (OMB) for Federal statistical purposes. Most of the areas are classified simply as MSA’s. However, if an area has more than 1 million residents and meets other criteria, it is classified as a “consolidated metropolitan statistical area” (CMSA), which consists of two or more primary metropolitan statistical areas (PMSA’s).

The metropolitan areas are defined in terms of counties in all regions (except New England, where cities and towns are the primary units. In this region, OMB recognizes alternative county-based areas, which are termed “New England county metropolitan areas” (NECMA’s). Because the data to estimate economic activity for New England cities and towns are insufficient, the NECMA definitions are used in these projections.

The geographic definition of each metropolitan area is held constant for the entire historical and projected data series; that is, the counties in a metropolitan area as of June 1989 are included in that area for the earlier years, even though they may not have been officially part of the metropolitan area earlier.

The 336 metropolitan areas in table 1 consist of 249 MSA’s, 15 NECMA’s (excluding the Bridgeport-Stamford-Norwalk-Danbury, CT, NECMA), and 17 CMSA’s comprising 55 PMSA’s (including Bridgeport). (3)

Note.–BEA’s regional projections program is under the guidance and direction of Hugh W. Knox, Associate Director for Regional Economics. The MSA projections were prepared under the supervision of Kenneth P. Johnson, Chief of the Projections Branch of the Regional Economic Analysis Division, by Lyle Spatz, Duane G. Hackmann, Gerard P. Aman, George K. Downey, and John S. Turner. The projections were developed from historical estimates of earnings, income, and employment prepared by the Regional Economic Measurement Division under the direction of Linnea Hazen, Chief.

(1) Kenneth P. Johnson, R. Kort, and Howard L. Friedenberg, “Regional and State Projections of Income, Employment, and Population to the Year 2000,” SURVEY OF CURRENT BUSINESS 70 (May 1990): 33-54. This article discusses projected trends in economic activity and population for regions and States.

(2) The substate areas are defined so that their boundaries do not cross State of MSA boundaries. Additional information on projection methodology is available in the three-volume set, BEA Regional Projections to 2040; see the box on data availability for ordering information.

(3) The Bridgeport-Stamford-Norwalk-Danbury, CT, NECMA (Fairfield County) is considered a PMSA and a component of the New York-Northern New Jersey-Long Island, NY-NJ-CT, CMSA.

;