- Assessment methods
- Learning objectives
- Full programme
- Delivery method
- Teaching methods
The course, carried out with the help of technological tools, does not require special initial skills. An elementary knowledge of algebra and probability may be helpful, but not indispensable. Furthermore, familiarity with the use of spreadsheets in a PC will be useful.
The evaluation takes place entirely (100%) with a final exam, aimed at assessing the degree of achievement of the educational objectives.
The exam will take place through the e-leraning platform, using the PC and will consist of questions, both theoretical and practical, to which the student will have to provide an answer also through the use of the software presented. The exam will assess the student's ability:
• To apply the correct theoretical model to a practical problem;
• To resolve the model chosen with the use of the available software;
• To verify the compatibility with the current legislation of a financial contract;
• To evaluate the sensitivity of the solution to the parameters of the problem.
The 90-minute exam will be held in the University's computer labs, using University PCs. The total score of each test is 31. The exam is passed with a score not lower than 18 and the honors awarded to those who will achieve 31 points.
Partial tests will not be organized.
NOTE: Students with LD must contact the University Disability Service in time to define the individual training plan. To access the compensatory measures, strict compliance with the University regulations is recommended. Failing this, it will not be possible to recognize any compensatory measure in the examination.
The working environment of a modern graduate in law, either within companies or profession, requires complex training, which is not reduced to knowledge of the systems, but also embraces the basic concepts of finance. Furthermore, as a consultant for their clients, graduates must be able to provide advice based on concrete quantitative information, allowing them to make informed and "good" decisions.
The course aims to provide students:
1. Knowledge of basic financial instruments;
2. Knowledge of decision methods in conditions of uncertainty;
3. The competence to carry out the most common financial calculations in financial disputes;
4. The competence to evaluate different investment / financing opportunities in a consistent manner;
5. The ability to formalize a decision problem in a condition of uncertainty with an appropriate model;
6. The competence to resolve the decision problem even in the presence of risk aversion.
The topics will be presented with wide reference to the possible practical situations in which they can be applied.
Part I: Financial calculation (20 hours):
• Capitalization and discounting: elementary financial operations and usual financial regimes;
• The construction of the net present value of a financial transaction: classic formulas, the value of time, the case of "annuities". Perpetual returns in business assessments.
• The financial aspects of the main loan contracts: amortization, consumer credit, leasing. The construction of the amortization schedule in Excel.
• Calculation aspects in the evaluation of technical wear. The construction of a spreadsheet for finding the internal rate of a financial transaction.
• Anatocism: some aspects related to the management and evaluation of a current account.
• The bonds: securities without coupon and with coupon.
• Financial valuations: consistent and inconsistent methods.
Part II: Decisions in conditions of uncertainty (20 hours):
• Probability in a nutshell: concept of probability, conditional probability, Bayes theorem
• Introduction to Decision Analysis: good decisions Good results;
• Decision trees: formalizing a problem in a tree, using TreePlan software;
• Sensitivity analysis: the use of Excel's "Objective Search" and "Data Table" functions;
• The value of perfect and imperfect information
• Expected utility and risk aversion;
• Decisions in conditions of risk aversion.
A detailed lesson schedule will be made available at the beginning of the course.
Erio Castagnoli, Lorenzo Peccati, Matematica in azienda. Vol. 1: Calcolo finanziario con applicazioni (IV edizione). EGEA 2010 ISBN: 9788823821323
George E. Monahan, Management Decision Making (Spreadsheet Modeling, Analysis, and Application) August 2000, ISBN: 9780521781183
Further readings may be suggested during classes.
The teaching activities include lessons in presence and exercises. Teachers will present the theoretical topics and the calculation tools necessary to implement the results discussed. In particular, Excel will be used in the lessons and the "Treeplan" add-on, whose features will be explained during the lessons and students will have to acquire the necessary ability to use to pass the exam.
For this reason, students are invited to present themselves in the classroom with their PC. The University e-learning platform will also be used for the exchange of material between teachers and students.
Note: the course and the exam are baased on Windows machines. The software used is also compatible with the Mac environment, however it will be up to the student who wishes to use this system to manage any exceptions or differences between the two products.