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Durham University

Faculty Handbook 2022-2023

Module Description

Please ensure you check the module availability box for each module outline, as not all modules will run each academic year.

Department: Economics and Finance

ECON3251: FINANCIAL THEORY AND CORPORATE POLICY

Type Open Level 3 Credits 20 Availability Available in 2022/23 Module Cap Location Durham

Prerequisites

  • Intermediate Finance (ECON2101)

Corequisites

  • None.

Excluded Combination of Modules

  • None.

Aims

  • This module aims to:
  • provide students with theoretical knowledge and understanding of key selected theories in finance and corporate policy decisions by building on the knowledge and skills acquired at level 2.
  • familiarise students with selected empirical issues and methods of analysis of corporate financial decisions within the broader framework of financial theories.

Content

  • Expected utility, stochastic dominance and state-preference theories.
  • Mean-Variance criteria and portfolio theory.
  • CAPM, CCAPM and APT.
  • Asymmetric information and agency theory.
  • Capital structure.
  • Dividend policy.
  • Corporate governance.

Learning Outcomes

Subject-specific Knowledge:
  • At the conclusion of this module students should have:
  • knowledge and understanding of theoretical issues relating to corporate financial policy decision.
  • had the opportunities to appreciate the applications in corporate financial policy decisions drawing on recent research.
Subject-specific Skills:
  • At the conclusion of this module students should be able to apply their knowledge in decision making, in corporate financial policy and they should therefore also be able to critically judge the extent of each major financial policy decision on the wealth of the firm and solve relevant problems.
Key Skills:
  • Written Communication - through summative assessment.
  • Planning and Organising - by observing the strict assignment deadlines and by preparing for the examination.

Modes of Teaching, Learning and Assessment and how these contribute to the learning outcomes of the module

  • Teaching is by lectures and seminars. Learning takes place through attendance at lectures, preparation for and participation in seminar classes, and private study. Formative assessment is by means of an essay. Summative assessment is by means of a written examination and an assignment.

Teaching Methods and Learning Hours

Activity Number Frequency Duration Total/Hours
Lectures 20 1 Per Week 1 Hour 20
Seminars 8 4 in Each of the First Two Terms 1 Hour 8
Revision Lecture 2 2 in term 3 1 Hour 2
Preparation and Reading 170
Total 200

Summative Assessment

Component: Assignment Component Weighting: 30%
Element Length / duration Element Weighting Resit Opportunity
One written assignment 2000 words 100%
Component: Examination Component Weighting: 70%
Element Length / duration Element Weighting Resit Opportunity
One written examination 2 hours 100%

Formative Assessment:

One 1500 word essay.


Attendance at all activities marked with this symbol will be monitored. Students who fail to attend these activities, or to complete the summative or formative assessment specified above, will be subject to the procedures defined in the University's General Regulation V, and may be required to leave the University



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