The purpose of this paper is to extend the results of the analysis [9] on the optimal timing of messages.' The model and theorems [9] are applicable to a situation involving the of a single (or aggregated) decision-making unit's performance terms of a single (or aggregated) goal. This goal need not be constant over time. The model used [9] is a continuous-time finite horizon model whose formulation and optimization involved the use of a finite-state continuous-time Markov process and tools from continuous-time optimal theory. In the present paper, attention is restricted to a two-state process. This restriction decreases the generality of the results return for a more specific model and more specific theorems. A two-state process is typically chosen for analytical treatment because of expositional convenience or practical applicability. The two states of the process are defined by the usual general descriptions: in control or consistent with goal(s) and out of control or inconsistent with goal(s). This type of process has been analyzed using mathematical programming, quality-control, and Markov chain techniques.2

The article presents some empirical evidence on the influence of one kind of contemporary accounting message on investors' actions. Investors' actions result from investors' directed thinking processes. The objective of such processes is the construction of transformational strategies, each of which is a behavioral scheme that has some probability of transforming a problematic present state of affairs into a more desirable future state of affairs. The nature of the transformational strategies formulated by investors will be determined by the present beliefs, motives, attitudes, and expectations of investors. The transformational strategies formulated by an investor represent schemes for intervening in an empirical process in order to control his future experiences. During the construction of such strategies, events are predicted and the dimensions and scope of the control over empirical events that may be exercised by the investor are defined and evaluated. An investor's perceptual system is the medium with which the phenomena of the environment are noticed and registered in accordance with the network of concepts that governs the investor's perceptual processes.

The article focuses on evidence regarding the influence of annual reports on the market actions of common stockholders. The impact of data presented in annual accounting reports on changes in investors' price expectations has been evaluated. In Part I, which appeared in the April 1971 issue of the journal The Accounting Review, the motivation for the estimation models used and some details of these models have been considered. In this part, sample selection, estimation results, and related issues have been dealt with. The impact of data presented in annual accounting reports on changes in investors' price expectations has been evaluated. The regression models introduced in Part I were applied to data from a random sample of eighty firms. The sample firms were selected from the set of all December fiscal-year firms for which the data available for the period 1947-1966 has been given. The data includes net income, common equity, current assets, long term debt, current liabilities and others. The above items were used to form ratios that were used as regressors in the tests for the impact of accounting data on changes in investors' price-expectations.

The article focuses on business combinations. Economist Baruch Lev commented on risk reduction as a motive for conglomerate mergers and the use of a game theoretic approach-proposed by economist Jan Mossin in the determination of exchange ratios for business combinations. In essence, Lev argued that conglomerate mergers may have no economic justification, the argument stems from the possibility that investors may be able to attain the risk and rate-of-return objectives of a proposed merger via the process of making adjustments in their personal portfolios. As a corollary, it was suggested that economically unjustifiable mergers may impose unnecessary transactions costs on the stockholders of the merging firms. Although these arguments have appeal, it should be noted that they appear to ignore some evidence on the efficiency of the capital markets. The efficient markets hypothesis states that market prices fully reflect available information which is implied by the statement that prices adjust instantaneously and unbiasedly to new information.