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EII3005 FINANCIAL ECONOMETRICS
3 Credits

Pre-requisite Passed EIA2013 Econometrics I

Learning At the end of the course, students are able to:
Outcomes
1. Apply econometric techniques for financial time series data.
2. Conduct hypothesis testing based on financial theory.
3. Interpret the results from the analysis.
4. Draw valid conclusions for decision making.

Synopsis The course introduces the methods of construction of stock market indices, computation
of returns with adjustment on capital changes and estimations of betas. The concepts of
forecast errors, tests of market efficiency and analysis of daily stock price behaviour are
discussed. The concepts of spurious regression, stochastic process, stationarity and
order of integration are introduced. VAR modelling, impulse response function, variance
decomposition, causality test, cointegration, error correction mechanism ARCH models
and Risk Models are discussed. These techniques are taught using a variety of financial
models.

Medium of English
Instruction

Assessment Continuous Assessment : 50%
Weightage Final Examination : 50%

3. DEVELOPMENT STUDIES

EIH2001 SMALL AND MEDIUM ENTERPRISES
3 Credits

Pre-requisite None

Learning At the end of the course, students are able to:
Outcomes
1. Describe fundamental characteristics of small and medium enterprises (SMEs).
2. Discuss the significance of SMEs in national economic development.
3. Report financial management in SME.
4. Construct a business plan for setting up new venture.

Synopsis This course exposes the students to various aspects of SMEs including distinctiveness
and importance of SMEs, characteristics of an entrepreneur, sources of finance for start-
up SMEs, financing growth of SMEs, process of business start-up, and stages of growth
in the small firm. It also emphasises the importance of entrepreneurship for economic
development. From the practical side, the students are trained to prepare a business plan.

Medium of English
Instruction

Assessment Continuous Assessment : 50%
Weightage Final Examination : 50%