程序代写案例-ECON30024

ECON30024
Economics of Financial Markets

SUBJECT GUIDE

Semester 1, 2021


Prepared by
Shuyun May Li
s
[email protected]



Department of Economics
Faculty of Business and Economics



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Subject Outline
Introduction
Welcome to Economics of Financial Markets!
This subject is intended for students majoring in Economics who have a strong interest in
finance and some academic background in finance. It discusses the economics of financial
markets at an intermediate level, with a focus on important theories on the determination of
asset prices and returns.
Subject Overview and Aims
The overall aim of this subject is to provide students a solid foundation in the basic
economic principles governing financial markets. We start with an overview of financial
markets and financial assets, then discuss various modern theories of financial decision-
making under uncertainty, including portfolio selection under mean-variance preference, the
Capital Asset Pricing Model (CAPM), the Arbitrage Pricing Theory (APT), empirical testing of
the CAPM and APT, price determination based on net present value (NPV) relationships,
dynamic asset pricing and the equity premium puzzle. We conclude with an application to a
particular financial market--the bond market.
For further details, refer to the University Handbook
https://handbook.unimelb.edu.au/view/2021/ECON30024

Learning Outcomes
Learning Outcomes and Generic Skills
To view the subject objectives and the generic skills you will develop through successful
completion of this subject, please see the University Handbook:
https://handbook.unimelb.edu.au/view/2021/ECON30024

Eligibility and Requirements
To view the eligibility and requirements, including prerequisites, corequisites, recommended
background knowledge and core participation requirements for this subject, please see the
University Handbook:
https://handbook.unimelb.edu.au/view/2021/ECON30024

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Academic Staff Contact Details
Please see the Canvas LMS page of the subject for full contact details of the teaching staff in
this subject.
Subject Coordinator Contact Details
Name: Shuyun May Li
Email: [email protected]
Phone: 83445316
Consultation Hours: Friday, 12-1pm (online)
Email Protocol
Please note that we are only able to respond to student emails coming from a University
email address. Please do not use personal email addresses such as Yahoo, Hotmail or even
business email addresses. Emails from non-University email addresses may be filtered by
the University’s spam filter, which means that we may not receive your email. All
correspondence relating to this subject will only be sent to your University email address.
Note that you must first activate your University email address before you can send or
receive emails at that address. You can activate your email account at this link:
http://accounts.unimelb.edu.au/.
While academic staff endeavor to address queries received via email, it is more appropriate
to resolve substantive questions during lectures and tutorials and during normal consultation
hours. With this in mind, we encourage students to attend all lectures and tutorials and to
familiarise themselves with the consultation hours offered by the lecturer and tutors

Lectures
Lecture Times
The official lecture times are Friday 11am-1pm. However, lectures will be pre-recorded and
uploaded on LMS under Lecture Capture by Tuesday in every week. Please listen to the
recordings of lectures in a timely manner to keep yourself on track.
Lecture Participation Requirements
To increase interaction with students, I will use the first half of the second lecture time, 12-
1pm Friday, to run a live online discussion session. In these 30-minute discussion
sessions, I will briefly summarise what’s covered in the previous week, clarify some
questions arising from tutorials and/or Canvas Discussions, and answer questions you may
raise during the session. The second half of the lecture time will run like a normal online
consultation for which you are not required to stay if you do not have questions to ask.
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You are strongly recommended to attend these live online discussion sessions. Please be
aware that these sessions will not be recorded, but I will upload the slides that I use to
guide discussions. I think this is a good way for me to directly interact with you and address
your confusions and concerns. It’s also a good way to keep you on track and engaged in the
learning of this subject. By the time of the online discussion session, you should have gone
through the lectures for the previous week and worked on the relevant tutorial questions.
This would allow you to get the most out of the discussion sessions.
You can leave the meeting after the discussion session or stay to ask questions or listen to
other students’ questions.
For students who are unable to attend the live online discussion sessions due to time zone
or other restrictions, I want to assure you that there are many other ways to communicate
with me and ask questions, such as Canvas Discussions, Canvas chat, emails, or individual
appointment with me.
A Preliminary Lecture Schedule
Week Date
Commencing
Topic Required Reading
1 1/3/2021 Asset markets and asset prices Bailey, Chap. 1 & 2
2 8/3/2020 Predictability of prices and
market efficiency
Bailey, Chap. 3
3 15/3/2021 Decision making under
uncertainty
Bailey, Chap. 4
4 22/3/2021 Portfolio selection: the mean-
variance model
Bailey, Chap. 5
5 29/3/2021 Portfolio selection continue, the
capital asset pricing model
(CAPM)
Bailey, Chap. 6
6 12/4/2021

The CAPM continue, the
arbitrage pricing model (APT)
Bailey, Chap. 7
7 19/4/2021 Mid-term exam, APT continue Bailey, Chap. 8
8 26/4/2021 Empirical appraisal of CAPM
and APT
Bailey, Chap. 9, 10
9 3/5/2021 Asset pricing based on NPV
relationship
Bailey, Chap. 10
10 10/5/2021 Dynamic asset pricing and the
equity premium puzzle
Bailey, Chap. 11
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11 17/5/2021 Bond markets and the term
structure of interest rates
Bailey, Chap. 12, 13
12 24/5/2020
Review
Summary and review
Lecture Slides and Readings
Lecture slide, supplementary readings, pre-recorded lectures, tutorial problem set for the
coming week, and other study materials for the week will be uploaded on LMS by Tuesday
in every week.
At the end of the lecture slides for each topic, there is a list of review questions. These
questions reflect what I expect you to learn from the topic. You should use them to check
your understanding of the lectures.
Recorded Lectures
Pre-recorded lectures for this subject will be made available, which can be accessed by
clicking on the Lecture Capture menu item on the LMS page for this subject.
In these recorded lectures, key concepts and ideas will be elaborated on verbally and
important equations will be derived in more details. Please listen to the recorded lectures in a
timely manner. When you listen to lecture recordings, take notes on lecture slides and mark
your questions. You can ask questions on Canvas Discussions or bring them to the online
discussion sessions.
These recordings also allow you to revise lectures during the semester, or to review them in
preparation for the end of semester exam.

Tutorials
Tutorial Times
Tutorials will commence in the second week. Refer to University timetable for the date, time
and location of the tutorial classes.
https://sws.unimelb.edu.au/2021/
Tutorial Participation Requirements
Starting from week 2, there will be a weekly online quiz consisting of 5 multiple choice or
true/false questions on the previous week’s lectures. You need to complete the quiz by
Wednesday 12pm (that’s the time our first tutorial class starts) and get 2 or more questions
correct to earn 0.5 tutorial participation mark. Answers for these questions will be provided in
the tutorial classes in that week.
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Tutorial classes will be delivered LIVE online. Your tutor will email you the Zoom meeting
links for your official tutorial classes. Even though tutorial participation is not compulsory,
your participation in tutorials is essential for mastering what is covered in lectures. You are
strongly recommended to attend all tutorials, tackle the problems in advance and review
them afterwards.
If for some legitimate reason, you are not able to attend the allocated tutorial, you are
allowed to attend a replacement tutorial in the same week. You need to contact your tutor
and your tutor will arrange a meeting link for the replacement tutorial to be sent to you. A
student is not permitted to attend more than THREE replacement tutorials during the
semester.
The tutors will take turns to record one live tutorial class for each week. Recorded
tutorials and tutorial solutions will be uploaded on Friday, after all tutorial classes for the
week have been done. You will be informed if your tutorial class is going to be recorded. If
you do not want to attend that tutorial class, you can contact your tutor and your tutor will
arrange for you to attend another tutorial class in that week. A privacy statement regarding
video use and recording in teaching is available for you to read:
https://lms.unimelb.edu.au/students/student-guides/zoom-student-privacy. Please let me
know if you have any concerns.
For those students who could not attend live tutorials due to time zone or other restrictions,
please listen to the recorded tutorials and work through the problems in a timely manner.
For more detailed policies on tutorial participation, see the file titled “A List of Important
Subject Policies for ECON30024 Economics of Financial Markets” posted on LMS.
Tutor Consultation
The tutors for this subject are Yunpeng Deng, Kelly Bradley, and myself. My consultation
session is 12:30-1pm on Friday in every week, after the live discussion session. Yunpeng
and Kelly will take turns to hold a 1-hour tutor consultation session in every week, starting
from week 2. The consultation time will be announced on LMS. Zoom links for all consultation
sessions will be available under Canvas Zoom.
Students can also ask questions through Canvas Discussions, Canvas chat or emails. I
encourage you to ask questions on Canvas Discussions so that other students can see your
questions, answer your questions, and see replies to your questions. The tutors and I will
regularly check the discussion forum and answer your questions, but please allow for 48
hours for your questions to be replied. Some questions require elaborate explanation or
derivation, and you should come to consultation sessions for such questions.
I strongly encourage you to ask questions or raise concerns whenever you got one, through
the various ways of communication. Your progress in this subject and your wellbeing are
deeply cared by me and the tutors.
Private Tutoring Services
Faculty has become increasingly concerned about the existence of a number of private
tutoring services operating in Melbourne that heavily target University of Melbourne students
enrolled in FBE subjects.
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Students are urged to show caution and exercise their judgement if they are considering
using any of these services, and to please take note of the following:
Any claim by any of these businesses that they have a “special” or “collaborative” or
“partnership” style relationship with the University or Faculty is false and misleading.
Any claim by a private tutoring service that they are in possession of, or can supply you with,
forthcoming University exam or assignment questions or “insider” or “exclusive” information
is also false and misleading.
The University has no relationship whatsoever with any of these services and takes these
claims very seriously as they threaten to damage the University’s reputation and undermine
its independence.
It is also not appropriate for students to provide course materials (including University
curricula, reading materials, exam and assignment questions and answers) to operators of
these businesses for the purposes of allowing them to conduct commercial tutoring
activities. Doing so may amount to misconduct and will be taken seriously. Those materials
contain intellectual property owned or controlled by the University.
We encourage you to bring to the attention of Faculty staff any behaviour or activity that is
not aligned with University expectations or policy as outlined above.

Assessment
Assessment Overview
Your assessment for this subject comprises the following:
Assessment Task Individual or Group Due Weighting
Weekly Canvas quiz Individual week 2-12 5%
Assignment 1 Group 29/3/2021, 4pm 8%
Assignment 2 Group 14/5/2021, 4pm 12%
Mid-semester examination (online
quiz, open book, 1 hour)
Individual 23/4/2021, 12-
1pm
15%
End of semester examination (online
quiz, open book, 3 hours)
Hurdle requirement: To pass this
subject, students must pass the end
of semester examination
Individual During the exam
period
60%
For more detailed policies on each assessment, see the file titled “A List of Important
Subject Policies for ECON30024 Economics of Financial Markets” posted on LMS.
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Assignment Submission
Assignments are to be completed by a group consisting of no more than FOUR students.
Students should form their own assignment groups. Members of a group can be from
different tutorial classes. Each group only submits one copy of assignment.
Assignments should be submitted online via Canvas Assignments. Detailed instruction on
group registration and submission will be announced on LMS at appropriate time.
All members of a group are expected to contribute to the assignment. To encourage
students to contribute, some form of group member evaluation will be conducted after each
assignment is due.
Please note that you are required to keep a copy of your assignment after it has been
submitted as you must be able to produce a copy of your assignment at the request of
teaching staff at any time after the submission due date.
Penalties for Late Submission
Late submissions will incur a penalty (10% daily penalty for assignments, and 10% per
10 minutes for exams) unless an extension has been granted or there are unexpected
legitimate reasons. Students with a genuine and acceptable reason for not completing an
assignment (or other assessment task), such as illness, can apply for special consideration
(see policy below). The maximum extension for assignments is THREE days.
For more detailed policies on each assessment, see the file titled “A List of Important
Policies for ECON30024 Economics of Financial Markets” posted on LMS.

Subject Resources
Prescribed References
The textbook for this subject is Bailey, R.E. The Economics of Financial Markets, Cambridge
University Press, 2005. A pdf version of the book is freely downloadable on internet.
Supplementary Readings
As the subject progresses, supplementary readings, including journal articles, policy
discussion papers, and media reports, will be provided via Readings Online on LMS.

Academic Integrity
Academic Honesty
The University maintains high academic standards in its courses and subjects and expects
students to conduct themselves in a manner which is fair, honest and consistent with the
principles of academic integrity, particularly when undertaking assessment and research.
http://academicintegrity.unimelb.edu.au/
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Referencing
Each source used for a written piece of assessment must be referenced. This is to
acknowledge that your material is not based entirely on your own ideas, but is based, in
part, on the ideas, information, and evidence of others. This is desirable as you are
attending University in order to learn from others.
You will be required to use the Harvard System of referencing. The library has prepared a
website to help students correctly reference:
http://www.library.unimelb.edu.au/recite
It is important that all material you present for assessment is referenced correctly. Material
that has not been referenced correctly may be considered to be plagiarised, and as such
may be penalised. We will also look for evidence that material included in the bibliography
has been used in the assignment.
The Academic Skills Unit has produced resources to assist students with referencing
https://services.unimelb.edu.au/academicskills/undergrads/top_resources
The Library also provides advice on referencing: http://library.unimelb.edu.au/cite

University Services
Timetable
MyTimetable is a class timetabling system that creates individual timetables for students
based on submitted class preferences, ensuring everyone has an equitable opportunity of
getting their preferred class timetable. You will use this system to create your class timetable
prior to each study period.
By following a preference-based model, students who have other commitments, such as
employment or carer responsibilities, or who are returning or living overseas during the
timetabling period, aren’t disadvantaged by their limited availability. When allocating class
timetables, MyTimetable also takes into consideration factors such as class size limits and
potential clashes to ensure all students are equally accommodated. Further information is
available on the web at https://students.unimelb.edu.au/admin/class-timetable
Stop 1: Connecting Students and Services
Stop 1 is here to provide you with a range of support services throughout your university
degree, from help with enrolment, administration and wellbeing to advice on building your
skills and experiences. https://students.unimelb.edu.au/stop1
Academic Skills
Academic Skills offers a range of workshops and resources to help you with study skills
including researching, writing and referencing, presentation skills and preparing for exams.
Visit their website via http://services.unimelb.edu.au/academicskills.
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Service Finder
The University of Melbourne offers one of the most comprehensive student support
networks in Australia. Use this site to locate a wide range of services
http://services.unimelb.edu.au/finder
Student Counselling
Students attend counselling to talk about personal, emotional, or mental health issues which
might be affecting their study and life. The University’s Counselling and Psychological
Services (CAPS) provides free, confidential, short-term professional counselling to currently
enrolled students and staff. https://services.unimelb.edu.au/counsel/individual
Student Equity and Disability Support
Student Equity and Disability Support provides services for students who need ongoing
support with their studies. They understand that adjustments to learning and assessment
are sometimes required to allow all students to reach their full potential. Learn more about
the services provided, how to find support and how to register for assistance.
http://services.unimelb.edu.au/student-equity
University of Melbourne Library Services
As well as holding an extensive collection of books, ebooks, digital media and periodicals,
library staff provide research guidance and support for students.
http://library.unimelb.edu.au/

These Business and Economics Library Guides have been designed specifically for Faculty
of Business and Economics staff and students.
http://unimelb.libguides.com/sb.php?subject_id=80310

Policy
Alternative Exam Arrangements (AEA)
The definition of and eligibility requirements for alternative exam arrangements (AEA) can
be found via http://students.unimelb.edu.au/admin/alternate .
Assessment and Results Policy
The University’s assessment policy provides a framework for the design, delivery and
implementation of assessment of students in award and non-award courses and subjects.
Assessment is designed to contribute to high quality learning by students, and to allow for
quality assurance and the maintenance of high academic standards.
https://policy.unimelb.edu.au/MPF1326
Assignment Extension
Requests for an assignment extension should be submitted here:
http://go.unimelb.edu.au/yh9n.
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Before completing this form, please read the Assignment Extension Policy, which can be
found at: http://policy.unimelb.edu.au/MPF1326#section-4.37
Exam Policy
The University requires that you are available for the entire examination period. Please see
the University's Principal Dates via https://www.unimelb.edu.au/dates#2020 for the full
annual calendar. Supplementary exams will not be provided in cases of absence during the
examination period unless the absence is due to serious illness or other serious
circumstances and a Special Consideration application is submitted and approved.
Information on Calculators in Examinations
Effective from 1 January 2017, the approved calculator for all subjects is the Casio FX82
(any suffix). No equivalent models of calculators will be permitted in exams.
You are required to purchase your own calculator and are responsible for ensuring your
calculator is in good working order with fresh batteries.
Plagiarism and Collusion
Plagiarism (failure to cite your sources correctly and completely) and collusion (unauthorised
collaboration with another person to prepare an assessment task) are considered academic
misconduct and attract severe penalties. More information is available on the University’s
Academic Integrity website via http://go.unimelb.edu.au/rha6.
Special Consideration
As a student, you may experience extraordinary or unusual circumstances, or ongoing
circumstances that adversely affect your academic performance. The University has policies
in place to support students who are experiencing academic disadvantage. For more
information, visit http://students.unimelb.edu.au/admin/special.


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