Course Information Undergraduate prospectus

Introduction to Finance and Economics

Course summary

Course code: FINA1126
Level: 4
Credits: 30
School: Business Faculty
Department: Accounting and Finance
Course Coordinator(s): Nadia Benbouzid

Specification

Aims

This course provides students with an introduction to both economics and financial institutions and markets. The course first starts by an introduction to micro and macro-economics, central banking and monetary policy. These basic introductory concepts will allow students to understand how the global economy functions and grasp the implications monetary policy has on the functioning of the financial system.

Students will be able to address questions relating to what happens if there is contractionary/expansionary monetary policy in the economy? What could be the effect of having excess supply/demand in the economy? What is the role of the central bank and how does it control the money supply in the economy? In answering these questions, the participants will acquire the basic knowledge of economics and understand its implications in the financial system.

The course then progresses into introducing students to the basic function of financial markets, institutions and financial regulation. This will enable students to distinguish between the different types of financial institutions and understand the principle of financial regulation. It addition to the theoretical knowledge of economics and the functionality of financial markets, students will also learn the more technical knowledge of managing short-term finance, financial mathematics and understand how to use financial mathematical techniques in practice.

Learning outcomes

On successful completion of this course a student will be able to:

1. Analyse the foundations of micro and macroeconomics.
2. Evaluate the role of business organisation, its stakeholders and the external environment.
3. Investigate the role of central banks in controlling the monetary policy and money supply.
4. Interpret the role of financial markets and institutions and understand the regulation they are subjected to.
5. Demonstrate the ability to manage short-term finance.
6. Apply financial mathematical techniques and effectively interpret the obtained results.

Indicative content

Introduction to Micro and Macro Economics, Central Banking and Monetary Policy:
Foundations of Microeconomics: Demand and Supply, Foundation of Macroeconomics: Money and Interest Rates, Macroeconomic Issues and Analysis, Monetary Policy and the role of central Banks, Business organisation, its stakeholders and the external environment.

Introduction to Financial Markets:
The Money Markets, Equity and Bond Markets.

Introduction to Financial Institutions:
Commercial and Investment Banking Structure, Savings Association and Credit Unions, Regulation of the banking system and financial services industry and Insurance companies.

Managing Short Term Finance:
Identify short-term funding and investment opportunities.

Financial mathematics: Calculate present and future values of cash flows and Apply financial mathematical techniques: Project Valuation.

Teaching and learning activity

This course will be delivered through a combination of lectures and supporting seminars. Lectures will focus on explaining the theoretical and technical contents to equip students with the basic knowledge of economics, financial markets and institutions.

Seminars will be used for students’ group work, which forms part of their assessment for this module. During seminars, students will extend their knowledge by reading academic papers that form the basis of the lecture. In addition, in order to enhance students’ independent learning, they will be provided with a reading list that will cover general background literature and more focused finance and economics based case studies. The seminars will be used as a forum for a critical discussion of the literature and related methodologies. Moreover, other seminars will be devoted to the more practical mathematical finance exercises that will help students understand and link theory to practise.

Assessment

Nature of Summative assessment supporting student learning: Research Based Essay
Outcome(s) assessed by summative assessment (Please use the numbers above to refer to these): 4
Grading Mode:Numeric
Weighting: 40%
Pass Mark: 40%
Word Length: 2000 words
Outline Details: A research based report

Nature of Summative assessment supporting student learning: Exam
Outcome(s) assessed by summative assessment (Please use the numbers above to refer to these): 1 - 6
Grading Mode:Numeric
Weighting: 60%
Pass Mark: 40%
Word Length: n/a
Outline Details: A closed book exam 3 hours.
3 hours