INTRODUCTION TO THE THEORY OF FINANCE

ECON374

Course Code: ECON374
Semester: -
Theory+Practice: 3 + 0
ECTS: 5

Course Type

Elective Course

Course Level

Bachelor's Degree

Year of Study

Semester

ECTS

Name of Lecturer(s)

Professor Burçhan Sakarya

Learning Outcomes

At the end of this course, the students;

Define the basic concepts related to finance
Define the financial system and its components; the concepts of interest, risk return, time value of money and discounted cash flows
Interpret the financial statements
Interprets how business cycles affect via making the financial analysis.

Mode of Delivery

Face to face

Prerequisites

Recommended Optional Programme Components

None

Course Description

This course introduces the basic theory of modern financial economics and financial management, focusing on capital markets and investments. Functions of capital markets and financial intermediaries, asset valuation, fixed-income securities, common stocks, capital budgeting, diversification, portfolio selection, equilibrium pricing of risky assets, the theory of efficient markets, and an introduction to derivatives and options are some of the topics covered.

Course Contents

WEEK	TOPICS
1^st Week	Financial Markets and Firms
2^nd Week	Financial Statement Analysis / IAS?VUK Differences
3^rd Week	Time Value of Money and Applications
4^th Week	Future Value of Money and Applications
5^th Week	Risk, Return, and Risk Management
6^th Week	Alternative Financial Instruments
7^th Week	Midterm
8^th Week	Portfolio Management and Diversification
9^th Week	Investment and Returns
10^th Week	CAPM Model and Applications
11^th Week	Modigliani?Miller (M&M) Model and Applications
12^th Week	Firm Valuation Methods
13^th Week	Discounted Cash Flows and Comparable Company Multiples
14^th Week	Equity Valuation (Stock Pricing)

Recommended or Required Reading

Dahlquist, Julie, Knight, Rainford. (2022). Principles of Finance. OpenStax. Printed in B&W, ISBN-13: 978-1-711470-53-5.
Mishkin, F. S., Eakins, S. G. (2000). Financial Markets and Institutions, Seventh Edition, Prentice Hall, Pearson, ISBN-10 : 9781292060484.
Lawrence J. Gitman Chad J. Zutter. (2014). Principles of Managerial Finance. 14. Baskı, Pearson Education, ISBN-10: 1292018208.
Brealey, Richard, Stewart Myers ve Franklin Allen. Principles of Corporate Finance. 9. baskı New York, NY: McGraw Hill, 2007. ISBN: 978007126

Planned Learning Activities and Teaching Methods

Lecture
Discussion
Presentation

Assessment Methods and Criteria

	Quantity	Percentage (%)
Mid-term	1	30
Quiz	4	15
Project	1	15
Total(%)		60
Contribution of In-term Studies to Overall Grade(%)		60
Contribution of Final Examination to Overall Grade(%)		40
Total(%)		100

ECTS Allocated Based on Student Workload

Activities	Quantity	Duration (Hour)	Total Workload (Hour)
Midterm exam	1	1.5	1.5
Preparation for Quiz	4	2	8
Individual or group work	14	3	42
Preparation for Final exam	1	20	20
Course hours	14	3	42
Preparation for Midterm exam	1	20	20
Laboratory (including preparation)	0	0	0
Final exam	1	1.5	1.5
Homework	0	0	0
Presentation (including preperation)	1	10	10
Total Work Load			145
Total Work Load / 30 (h)			4.83
ECTS Credit of the Course			5

Language of Instruction

Turkish

Work Placement(s)

Programme Qualifications / Learning Outcomes

	LO1	LO2	LO3	LO4
K1	X
K2
K3	X	X
K4			X
K5				X
K6
K7
K8
K9	X	X
K10				X
K11
K12
K13