154-0323/01 – Financial Decision-Making under Risk (FRR )
| Gurantor department | Department of Finance | Credits | 5 |
| Subject guarantor | prof. Ing. Tomáš Tichý, Ph.D. | Subject version guarantor | prof. Dr. Ing. Zdeněk Zmeškal |
| Study level | undergraduate or graduate | Requirement | Compulsory |
| Year | 1 | Semester | winter |
| | Study language | Czech |
| Year of introduction | 2004/2005 | Year of cancellation | 2020/2021 |
| Intended for the faculties | EKF | Intended for study types | Follow-up Master |
Subject aims expressed by acquired skills and competences
The aim of the course is to allow the students to:
- understand key financial issues under risk and uncertainty
- learn how to propose robust solutions of these issues using up-to-date tools and techniques
- evaluate the linkage between the return and risk
- understand flexible approaches to decision-making
- analyze the linkage between primary variables and proposed solutions.
Teaching methods
Lectures
Tutorials
Summary
In this course, fundamental issues of financial decision-making are treated. Special attention is paid to the risk and flexibility. The course extends knowledge obtained in basic corporate finance courses by the aspects of risk and flexibility. As well, it extends financial markets courses by proper mathematical treatment. The aim of the course is to introduce key financial issues and teach the students to propose their robust solutions with up-to-date techniques. The students should be able to analyze the linkage between primary variables and proposed solutions.
Compulsory literature:
Recommended literature:
Additional study materials
Way of continuous check of knowledge in the course of semester
E-learning
Other requirements
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Prerequisities
Subject has no prerequisities.
Co-requisities
Subject has no co-requisities.
Subject syllabus:
1. Proposal methods and evaluation of firm financial plan
2. Financial decision-making criteria under risk – principles, axoms
3. Utility functions, their application in financial decision-making
4. mean-variance models, Markowitz model
5. CAPM model, APT model.
6. Theory of company´s capital structure
7. Capital budgeting, investmnt valuation under risk
8. Dividend theories and policies.
9. Company valuation under risk
10. Acquisitions
11. Forward and futures contracts
12. Option contracts. Hedging.
13. Hedging, methods of hedging, possibilities in financial management
14. Option methodology and its application in financial management
15. Cash management of multinational firm (theory of exchange rates estimation)
Conditions for subject completion
Occurrence in study plans
Occurrence in special blocks
Assessment of instruction