FINA 385Theory of Finance I






Prerequisite: COMM 220, 308. This course is the first of two that provide a theoretical foundation upon which subsequent 400-level courses will be built. The course examines the allocation of capital in financial markets and the determination of the relative prices of financial assets. Topics covered include utility theory, arbitrage pricing theory, and asset pricing models such as the Capital Asset Pricing Model and the option pricing model. Applications explored include arbitrage, the design of markets and the appropriate responses of individuals and firms to changes in market conditions as well as to market imperfections.
NOTE: Students who have received credit for FINA 380 may not take this course for credit.