Statusmelding

Denne kursbeskrivelsen finnes bare på engelsk.

EXC 2110 Basic Financial Management

EXC 2110 Basic Financial Management

Course code: 
EXC 2110
Department: 
Finance
Credits: 
7.5
Course coordinator: 
Salvatore Miglietta
Product category: 
Bachelor
Portfolio: 
Bachelor of Business Administration - Programme Courses
Semester: 
2019 Autumn
Active status: 
Active
Teaching language: 
English
Course type: 
One semester
Introduction

The essence of business administration includes corporate finance (=investment and financing). Good knowledge within these areas is a necessary prerequisite to understand the economic content of investment and financing decisions, obtain decision-relevant information, discuss and assess alternatives, make correct decisions and convey relevant and useful information.
The aim of the first course within the field of corporate finance is to provide the students with essential basic knowledge and skills, so that they can take part in discussions on problems in finance and carry out simple analyses within the field, make correct decisions and communicate the results of the analyses in a comprehensible manner.
The course Basic Financial Management is mainly focused on capital budgeting. By studying the main activities carried out in a company as an investment project over several periods, emphasis is placed on considering all economic effects of the project and of taking a long-term perspective (over several years, until the project is completed). The course therefore starts with capital budgeting. The finance area also focuses on how uncertainty affects decisions on which investments should be made (the risk and return on individual projects and portfolios) and owners’, creditors’ and companies’ capital costs.

Learning outcomes - Knowledge

After taking the course, the students shall be able to explain key concepts and give an account of the tools used in analyses of finance problems (these tools include methods, techniques, models, theories, etc. applied in the subject area).

  • Examples of concepts that students shall be able to explain: sunk cost, present value, future value, income statement, annuity, cash flow and risk adjusted cost of capital, variance, standard deviation, expectation, efficient portfolios, risk aversion, bonds, market efficiency, anomalies, risk premium.
  • Examples from the toolbox: cash budget, investment budget, net present value, internal rate of return, capital asset pricing model, portfolio theory.

 

Learning outcomes - Skills

After taking the course, the students shall be able to (a) apply knowledge (i.e. concepts and skills) in analyses and discussions on financial problems, (b) distinguish between relevant and irrelevant information, and (c) give written answers to questions so that the readers understand the applied methods and conclusions. Examples:

  • When the tool is given, be able to apply the tool correctly
  • Based on simple situation descriptions, choose the right tool and apply it correctly
  • Based on more complex situation descriptions, be able to produce relevant information, link it to the suitable tool and apply the tool correctly
General Competence
  • After taking the course, the students shall be able to ask critical questions and reflect on crucial assumptions and theories within the business economics field.
Course content

 

1. Introduction and Overview: ch. 1
2. How to Calculate Present Value: ch. 2
3. Valuing Bonds: ch. 3
4. The value of common stocks: ch. 4
5. Net Present Value: ch. 5
6. Making Investment Decisions: ch. 6
7. Introduction to risk and return: ch. 7
8. Capital Asset Pricing Model:ch. 8
9. Risk and Cost of Capital: ch. 9

 

Teaching and learning activities

The course will include a combination of lectures and plenary tutorials where solutions to exercises will be explained. 

The students are responsible for obtaining any information provided in class that is not included on the course homepage/It's learning or the text book. 

Software tools
No specified computer-based tools are required.
Additional information

Students are advised to make use of computer-based tools in the course, for instance spreadsheets.

Required prerequisite knowledge

Basic bachelor courses in Mathematics and Statistics.

Exam categoryWeightInvigilationDurationSupport materialsGroupingComment exam
Exam category:
Submission
Form of assessment:
Structured test
Exam code:
EXC 21101
Grading scale:
ECTS
Grading rules:
Internal examiner
Resit:
Examination every semester
100Yes3 Hour(s)
  • BI-approved exam calculator
  • Simple calculator
  • Bilingual dictionary
Individual
Exams:
Exam category:Submission
Form of assessment:Structured test
Weight:100
Invigilation:Yes
Grouping (size):Individual
Support materials:
  • BI-approved exam calculator
  • Simple calculator
  • Bilingual dictionary
Duration:3 Hour(s)
Comment:
Exam code:EXC 21101
Grading scale:ECTS
Resit:Examination every semester
Type of Assessment: 
Ordinary examination
Total weight: 
100
Workload activityDurationType of durationComment student effort
Teaching36Hour(s)
Review of assignments in plenary6Hour(s)
Prepare for teaching118Hour(s)Preparation for lectures and plenary tutorials and
work on two voulentary hand-in assignments.
Self study40Hour(s)Preparation for the final exam.
Expected student effort:
Workload activity:Teaching
Duration:36 Hour(s)
Comment:
Workload activity:Review of assignments in plenary
Duration:6 Hour(s)
Comment:
Workload activity:Prepare for teaching
Duration:118 Hour(s)
Comment:Preparation for lectures and plenary tutorials and
work on two voulentary hand-in assignments.
Workload activity:Self study
Duration:40 Hour(s)
Comment:Preparation for the final exam.
Sum workload: 
200

A course of 1 ECTS credit corresponds to a workload of 26-30 hours. Therefore a course of 7,5 ECTS credit corresponds to a workload of at least 200 hours.