Financial Economics: Intermediate

About the education 

NEK206 Econometrics, 7.5 credits

This course discusses the use of data to establish and quantify causal relationships between economic variables. We consider cross-sectional, as well as panel and time series data. The students learn to distinguish between causal relationships and correlations. An empirical analysis of a causal relationship requires a source of correlations. An empirical analysis of a causal relationship requires a source of exogenous variation.
The course introduces two econometric methods (ordinary least squares and instrumental variable regression) that exploit different sources of exogenous variation.
The students learn about the role of control variables, measurement error and equilibrium conditions (“simultaneous equations”) in assessing the plausibility of an exogeneity assumption. They learn how to use the framework of statistical testing to account for the fact that a dataset does not contain 1) data on all relevant economic units, 2) measurements of all determinants of unit behavior. In addition to learning about the theoretical foundations of econometric methods, the students will learn how to apply them to real economic data. To this end, they will learn how to process and analyze economic data using a statistical software.

Canvas, course syllabus and reading list

EFI202 Financial Accounting and Statement Analysis, 7,5 credits

The course focuses on theoretical aspects of the measurement issues that arise in financial statement preparation, including general structures and principles in financial accounting. In the accounting theory section, the aspects are covered from a preparer perspective. In the financial statement analysis section they are covered from a user perspective. In addition, the course covers issues that arise in the regulation of financial accounting, and in the audit of financial statements. 

In the area of regulation, the course gives an overview of current regulation, why regulation exists and the costs and benefits of regulation. Various regulatory vehicles are discussed, as well as which specific rules Swedish and other companies currently must follow. The accounting theory section focuses on underlying principles and structures and how these principles are reflected in a number of current accounting standards. Financial statement analysis covers how users of financial statements are affected by firms’ accounting policy choices as well as how these choices are reflected in actual financial statements. Financial statement analysis also includes models for business valuation and how financial statements can be used in such models. 

An area where accounting theory is reflected in specific standards, and that is in particular focus in the course, is group accounting. In this section of the course, students learn the principles and conceptual ideas behind different group accounting methods. There are also technical aspects, where students obtain insights into the preparation of consolidated financial statements. The course includes elements that will strengthen students’ generic competences. Analytical skills are acquired in solving theoretical and practical assignments. Oral and written communication skills, as well as training in finding information, are acquired via the submission of written reports combined with oral presentations and discussions in seminar groups.

Canvas, course syllabus and reading list

NEK203 Microeconomic theory, 7,5 credits

The course aims to provide in depth knowledge in microeconomic theory. The theory of individual consumer and producer behaviour and how these theories is deepened.
Deviations from the model of perfect competition are being studied. The theories are partly explained using abstract symbols and in a more mathematical way than in the
introductory course. Therefore, the course also contains some pure math lectures that are examined seprarately.
A course in microeconomics is a good starting point to other more specialized courses such as financial economics, public economics or environmental economics, which in turn can lead to a project paper in which theories and statistical methods are used.

Canvas, course syllabus and reading list

EFI242 Finance, Intermediate course, 7,5 credits

The course examines important issues in financial management with focus on investment and financing decisions under risk. The course covers topics such as cost of capital, capital structure, dividend policy, capital budgeting and the pricing of financial instruments and corporate liabilities.

Canvas, course syllabus and reading list

Prerequisites and selection

To be eligible for the course 60 passed credits from the first three semesters of the Bachelor's Programme in Business and Economics or equivalent are required.