Module Catalogues

Financial Economics

Module Title Financial Economics
Module Level Level 4
Module Credits 5.00
Academic Year 2021/22
Semester SEM1

Aims and Fit of Module

This module provides students with an understanding of the economic underpinnings (the backbone) of finance. In other words, students are taught a deep understanding of the economic models on which corporate valuation, asset pricing and financial markets are based.

Learning outcomes

A. Acquire a firm foundation in utility theory and its main axioms.
B. Develop the ability to make Choices in risky situations; measuring risk and risk aversion
C. Gain a deep understanding of the economic foundations for at least four major theories in finance.
D. Gain intuition into the role of financial markets and institutions.
E. Understand that financial theory has been shaped and is evolving as a result of option pricing theory and behavioural finance.

Method of teaching and learning

The module will comprise a combination of lectures and seminars. Main lectures will deliver key theories and concepts in the aspect of financial economics. In seminars students will have the opportunity to solve problems and numerical exercises, to review and discuss current research papers, and to present a short essay.