• Offered by Research School of Economics
  • ANU College ANU College of Business and Economics
  • Course subject Economics
  • Areas of interest Economics, Finance

This course examines the economic principles that determine the allocation of resources through time in market economies. It uses supply and demand relationships to value capital assets (or projects more generally). There is a detailed treatment of the effects of risk and taxes on capital asset prices, and the Modigliani-Miller financial policy irrelevance theorems are derived and examined in detail.

Learning Outcomes

Upon successful completion, students will have the knowledge and skills to:

By taking this course students will:

  • be exposed to the classical finance model that underpins modern finance;
  • understand how securities are priced and affected by the institutional arrangements in securities markets,
  • including taxes and other government regulations, and the role played by time, uncertainty, information and inflation;
  • know the role played by arbitrage in finance markets and its impact on security prices;
  • understand how security prices are determined in the Capital Asset Pricing Model, and the role played by the assumptions in the model;
  • know the assumptions behind the the Modigliani and Miller (M-M) financial policy irrelevance theorems as basis for understanding the factors that determine the debt-equity and dividend policy choices of firms.

Other Information

See the course outline on the College courses page. Outlines are uploaded as they become available. 

Indicative Assessment

Two examinable tutorials will be held during the semester, they are both fully redeemable.  The first one, which can contribute 10 per cent to the final grade, will be held just prior to the mid-semester break, while the second one, which can contribute 15 per cent, will be completed just after the mid-semester break.  The dates will be set two weeks in advance and will be announced in lectures and posted on WATTLE.  A three (3) hour exam is held at the end of semester.

The ANU uses Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. While the use of Turnitin is not mandatory, the ANU highly recommends Turnitin is used by both teaching staff and students. For additional information regarding Turnitin please visit the ANU Online website.

Workload

Two lectures per week with tutorials

Requisite and Incompatibility

Completion of ECON 2101/2111 Microeconomics 2 (P or H). Incompatible with ECON 3016 Financial Economics (H)

Preliminary Reading

Hirschleifer, J., Price Theory and Applications (2nd Edition), 1980 - Chapter 16.
A combination of material is drawn from books, journals and lecture handouts.

Fees

Tuition fees are for the academic year indicated at the top of the page.  

If you are a domestic graduate coursework or international student you will be required to pay tuition fees. Students continuing in their current program of study will have their tuition fees indexed annually from the year in which you commenced your program. Further information for domestic and international students about tuition and other fees can be found at Fees.

Student Contribution Band:
3
Unit value:
6 units

If you are an undergraduate student and have been offered a Commonwealth supported place, your fees are set by the Australian Government for each course. At ANU 1 EFTSL is 48 units (normally 8 x 6-unit courses). You can find your student contribution amount for each course at Fees.  Where there is a unit range displayed for this course, not all unit options below may be available.

Units EFTSL
6.00 0.12500
Domestic fee paying students
Year Fee
1994-2003 $2922
2004 $3234
2005 $3234
2006 $3240
2007 $3240
2008 $3240
2009 $3240
2010 $3240
2011 $3240
2012 $3240
2013 $3240
2014 $3246
International fee paying students
Year Fee
1994-2003 $2922
2004 $3234
2005 $3234
2006 $3288
2007 $3426
2008 $3426
2009 $3426
2010 $3750
2011 $3756
2012 $3756
2013 $3756
2014 $3762
Note: Please note that fee information is for current year only.

Offerings, Dates and Class Summary Links

The list of offerings for future years is indicative only.
Class summaries, if available, can be accessed by clicking on the View link for the relevant class number.

Second Semester

Class number Class start date Last day to enrol Census date Class end date Mode Of Delivery Class Summary
9381 18 Jul 2016 29 Jul 2016 31 Aug 2016 28 Oct 2016 In Person N/A

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