English   Danish

2011/2012  BA-HA_E15  Quantitative Methods in Finance and Economics

English Title
Quantitative Methods in Finance and Economics

Course Information

Language English
Point 7,5 ECTS (225 SAT)
Type Elective
Level Bachelor
Duration One Semester
Course Period Autumn
schedule: Group A: wednesday 08.00-10.35, week:36-45 Group B: thursday 11.40-14.25, week 36-45
Time Table Please see course schedule at e-Campus
Study Board
Study Board for BSc in Economics and Business Administration
Course Coordinator
  • Bjarne Florentsen - Department of Finance
Secretary Marianne Andersen - ma.fi@cbs.dk
Main Category of the Course
  • Finance
  • Statistics and mathematics

Taught under Open University-Taught under open university.
Last updated on 29 maj 2012
Learning Objectives
The course will enable students to formalize and solve problems business managers and economists might be facing in their working lives. Emphasis will be given to applying the methods introduced in class for solving problems in finance and economics.

To attain the top grade, students are required to have a good understanding of quantitative methods and their applications. This includes – among others – the ability to:
  • Formalize verbally expressed problems in a mathematical way and identify ways to solve such problems.
  • Identify, classify and apply methods suited for solving a given problem.
  • Give economic interpretations to mathematical relations / results.
  • Generalizing arguments/methods/concepts to problems that have not been analyzed explicitly throughout the course.
The course is open to all bachelor students seeking not only a qualitative but also a quantitative understanding of key economic concepts. The course is especially recommended for students in the final year of their bachelor studies that intend to apply for a master program in “Finance and Accounting”, “Finance and Strategic Management” or “Applied Economics and Finance”.
4 hour open book exam
4 hour open book exam:
Assessment Written Exam
Marking Scale 7-step scale
Censorship No censorship
Exam Period Winter Term
Aids Open Book, Written and Electronic Aid is permitted
Duration 4 Hours
The exam is PC-based with no internet access. It is possible to write in hand. Following calculators are allowed: Hewlett-Packard: HP10BII and Texas: Texas BAII Plus.
Course Content

The objective of the course “Quantitative methods in finance and economics” is to provide bachelor students with highly desirable quantitative skills required when pursuing a master’s degree. For all bachelor students seeking to apply for some such degree, it is therefore highly recommended to take this course.

Throughout the course, strong emphasis will be given to relate the theoretical concepts to applications in business management, economics and finance.

The key contents of the course are:

· Linear Algebra

· Calculus

· Optimization

Quantitative methods are powerful tools in economics and finance that can help understanding economic phenomena. Fruitful economic applications include, for instance, portfolio optimization, linear regression, interest rate calculations, elasticities, and modeling of uncertainties.

Many economic problems are optimization problems. An important step to solve such problems is to identify the right method. Providing you with a “toolbox” containing several of these methods is a key objective of the course.Even though implementing these models on a computer will not be dealt with in depth in class, the course shall provide you with the necessary background to do so on your own

Teaching Methods
To help you deepening your understanding of the contents of the course, you will be given references to recommended exercises in the accompanying book. Furthermore, every week you will receive a set of homework problems, some of which are old exam questions. Solutions to these problems will be discussed in class at the beginning of the following lecture. A couple of weeks prior to the exam, two “training sets” having roughly the length of an exam set will provide you with an additional opportunity of checking yourself.

The main reference for the course will be:

Sydsæter, K. and P. Hammond (2008): Essential Mathematics for Economic Analysis, Pearson Education / Prentice Hall, 3rd edition

This book was chosen as in contrast to many other books it does not only contain questions the students might want to deal with, but also provides them with sample solutions, which might e.g. be helpful when preparing for the final exam.