Syllabus academic year 2007/2008

Higher education credits: 7,5. Grading scale: TH. Level: G2 (First level). Language of instruction: The course will be given in Swedish. Compulsory for: RH4rh. Course coordinator: Bengt Horndahl,, Produktionsekonomi. Prerequisites: VBR180 Risk Analysis Methods, FMS065 Risk Analysis Methods, MIO012 Managerial Economics, Basic Course. Assessment: For a passing grade on the course it is required a passed individual written exam at the end of the course (4,5 p.), a passed individual laboratory work with accompanying questions accounted in a written report (1,5 p) and a passed handed in report to be done in a group of students and accounted for both written and orally. The exam will contain both theoretical questions and problems to solve witch will be graded. Parts: 3. Home page:

The aim of the course is to build on and tie together knowledge from earlier courses within the field of economic theory and applications and to create the necessary qualifications to use economic models in connections with risk and uncertainty. The course shall convey an insight in the character of investment planning and the roll and aim of different investment cost estimates.

Knowledge and understanding
For a passing grade the student must

Skills and abilities
For a passing grade the student must

The economical system which is essential in this course is investment planning. The intention is to give better tools to decision makers and politicians working with tangible and intangible investments and work for a safer society.

By way of introduction we go back to the basic course in Managerial Economics. The basic concepts are of course central. In the basic course investment planning was described from a business economics perspective and this course starts with repetition and deeper understanding of this field. Founded on the company strategy, goals, and demand forecasts the company must take into consideration different kinds of changes in the resource structure. This part deals with the role of the investments within the company and use of economic analyses on different types of investments. The traditional calculus methods are applied to more complex problems and the analyses are broadening among other things with deeper analyses of price changes, financing and uncertainty and risk.

In the second main part of the course the perspective is widening and the investment concept is treated from a social point of view. The course illustrates both more long-term (strategic) decisions and more short-term. Common to all decisions are that basic data for decision-making are needed and that the uncertainty and elements of risk often are important to the analysis. The process of risk restrain is described from the following subdivision: risk analysis, risk estimation, and choice of risk restrain actions. Here are among other things included how to compute the probabilities and the three central ways of risk transferring are introduced (diversifying, hedging, and insurance).

Nilsson, S-Å & Persson, I: Investeringsbedömning, Liber-Hermods, 2001 (IB).
Mattson, B : Riskhantering vid skydd mot olyckor - problemlösning och beslutsfattande, Räddningsverket, Karlstad, 2000 (M). The book is placed as a file in Luvit and can also be ordered from Räddningsverket.
Doherty, N : Integrated Risk Management: Techniques and Strategies for Managing Corporate Risk, McGraw-Hill Professional Publishing, 2000 (D). Chapter 1-3.


Code: 0107. Name: Economic Models for Risk Management.
Higher education credits: 4,5. Grading scale: TH. Assessment: Passed individually written exam done at the end of the course. Contents: Covers literature and lectures and consists of both theoretical questions and problem solving.

Code: 0207. Name: Laboratory Tests.
Higher education credits: 1,5. Grading scale: UG. Assessment: Passed individual laboratory experiment and resulting questions which shall be presented in a written form. Contents: Laboratory experiment covering investment planning and resulting questions which shall be presented in a written form.

Code: 0307. Name: Assignment.
Higher education credits: 1,5. Grading scale: UG. Assessment: Passed assignment done in a group and presented in a written report and orally. Contents: An assignment has to be done in a group and presented in a written report and orally.