ØSS112 Finance

Contents and structure

The main objective of this course is to provide students with insight into companies' investment and financing decisions and the theory underlying these decisions. The course will also cover various types of financial markets and assets, including the pricing of some such assets. Uncertainty and uncertainty management will be a particularly central theme in the course. The course is designed to alternate between theoretical and empirical focus, and covers a relatively wide range of financial topics, but quantitative methods will be central throughout the course.

Content

• Risk and cost of capital
• Financing decisions and market efficiency
• Dividend policy and capital structure
• Options

Learning Outcome

Knowledge

Upon completion of the course, the student should:

• Have knowledge of how capital markets function
• Have knowledge of how various assets are priced, and what properties different assets have, such as risk profile
• Have knowledge of the theoretical foundation of some central financial decisions

Skills

Upon completion of the course, the student should:

• Be able to calculate the value of certain types of financial assets, and thus determine which assets should be bought/sold
• Be able to calculate the cost of capital in various situations, and thus determine how investments should be financed
• Be able to use data tools, such as Excel, to structure financial decision-making problems

General competence

Upon completion of the course, the student should:

• Be able to critically reflect on central models and assumptions for these, such as those related to market efficiency and rationality.

Entry requirements

None

Recommended previous knowledge

The course builds on several previous courses in the bachelor's program, particularly BØA111 Mathematics, BØA115 Statistics, BØA203 Microeconomics, and BØA204 Investment and Financing. The course does not build directly on other specialization subjects.

Teaching methods

Lectures and independent work with theory and exercises.

Compulsory learning activities

2 assignments must be passed in order to take the final exam.

Assessment

Written school examination, 5 hours. The examination may be held on a digital examination system.

The date and location of the examination will be announced on Studentweb.

Grading scale A-F, where F represents fail.

Examination support material

Formula sheet included with the exam questions.

All calculator models are allowed, with the following exceptions:

• the calculator should not have the ability to receive/send data
• the calculator should not be able to process symbolic mathematical expressions
• the calculator may not be connected to a power source
• the calculator should not make noise

More about examination support material

Course reductions

• ØBO015 - Investering og finans - Reduction: 2.5 studypoints
• BØ6-2004 - Anvendt finans - Reduction: 7.5 studypoints