Time Schedule:
Larina F. Davis
ECON 422
Seattle Campus
Intertemporal optimization: consumption and portfolio allocation decisions of households, investment and financing decisions of firms. Introduction to financial decisions under uncertainty. Portfolio theory, asset pricing, options, and futures. Financial market institutions and efficiency. Prerequisite: 2.0 in ECON 300; either ECON 311, STAT 311, MATH 390, STAT 390, or Q SCI 381.
Class description
Economics 422 is an introduction to the basic concepts underlying finance theory. The theory of finance is concerned with the ways in which individuals and firms allocate resources through time. The theory seeks to explain how the allocation of resources through time is facilitated by (a) firms which provide the means by which individuals physically transform current resources into resources available in the future (production-investment decision) and (b) capital markets which provide a mechanism by which individuals can exchange resources over time. Students will learn basic details on a number of different security types and a number of major financial markets. Relevant financial calculations will be presented as well as real world examples. Core models of the field will be presented with additional exposure to current trends in finance theory.
Student learning goals
General method of instruction
Recommended preparation
Class assignments and grading
