Syllabus academic year 2011/2012
(Created 2011-09-01.)
Credits: 7,5. Grading scale: TH. Cycle: A (Second Cycle). Main field: Technology. Language of instruction: The course will be given in English. TEK103 overlaps following cours/es: NEK721, NEKM25 and NEKN81. Optional for: F5, F5fm, I4, I4fir, Pi5, Pi5fm. Course coordinator: Prof. Björn Hansson,, Department of Economics. Prerequisites: Grundläggande finansiell ekonomi och statistik. The number of participants is limited to 60 Assessment: Students are evaluated in a written exam. In addition, quick quizes during the course give points that are added to the score on the exam. Points from quick quizes are only added to the score on the exam during the same term as the quick quizes were carried out. Further information: Corresponds to NEKM25. Home page:

The objective of this course is to give the students an understanding of well known ideas and theories within financial economics.

Knowledge and understanding
For a passing grade the student must

Skills and abilities
For a passing grade the student must

Judgement and approach
For a passing grade the student must

develop an ability to pursue further studies in the field and to seek and evaluate information with a high degree of independence

The course contains the following building blocks

· investment decision under certainty: the risk free rate and Fisher-separability;

· risk aversion and expected utility;

· Arrow-Debreu securities;

· portfolio theory

· market equilibrium: CAPM and multi-factor equilibrium models;

· derivatives

· term structure of the interest rates;

· real options;

· efficient markets;

· information asymmetry and agent theory;

Thomas E. Copeland, Kuldeep Shastri and J.Fred Weston, (2004): Financial Theory and Corporate Policy, Addison Wesley
Supplementary material.