Sc

.Sc. (Economics) is the most prestigious program of the Institute, which is in operation since the Academic Session Fall 1985-86 for male and Spring 1992-93 for female students. A large number of graduates have been passed out since its inception. Later on, the master level programs were extended to other areas like Economics & Finance (since Fall 2001-02) and Islamic Banking & Finance (since Fall 2004-05). Admissions are open to both male and female candidates except in Islamic Banking & Finance, which is presently available for male candidates only.

Admission Requirements : i.Candidates with B.Sc.(Hons) degree in Economics/ Economics & Finance and Islamic Banking & Finance from IIUI with minimum CGPA of 2.0/4.0 or equivalent are eligible for admission to the first phase of the program in the relevant area. ii.Candidates with MA/M.Sc degree in Economics/ Mathematics/ Statistics or MBA degree (16 years of schooling) from recognized institutions with at least 50% marks are eligible to apply for admission to the first phase of the program. Admissions are however, granted purely on merit. iii.Candidates with M.Sc degree in Economics/Economics & Finance/ Islamic Banking & Finance from IIUI with minimum CGPA of 3.0/4.0 may apply for admission to Phase-II. They may be granted full or partial exemption from coursework, keeping in view their factual position to be determined by the Graduate Admission Committee of IIIE.

Program For: Male & Female

Structure of the Program /Degree requirements The programs are executed in two phases. Initially, the candidates are offered admission in M.Sc. program in the relevant area. The candidates maintaining CGPA of 3.0/4.0 in aggregate and passing NTS/GRE with requisite score may be enrolled in the second phase, failing which they will be awarded M.Sc. degree in the relevant area. (i) Phase-I: M.Sc. (Islamic Banking & Finance) Coursework

30 credits

Core Courses

15 credits

Elective Courses

15 credits

This phase is likely to be completed in 2-3 semesters.

(ii) Phase-II: M.Phil (Islamic Banking & Finance) Research

10 credits

M.Phil Thesis Seminar/Work 04 credits shop M.Phil Thesis/Dissert ation

06 credits

Total Degree Requirement s

40 credits

This phase is expected to be completed in 3-4 semesters.

Distribution of Coursework Phase-I: M.Sc (Islamic Banking & Finance) i.Core/Comp ulsory Courses

15 credits (5 courses)

Code

Title of Course

Credits

EBF 751

The AAOIFI Standard For Accounting, Auditing,| Shariah and Governance

03

EBF 755

Marketing of Financial Services

03

EBF 760

Islamic Banking: Theory, Practice and Legal Framework

03

EBF 765

Designing & Pricing of Financial Instruments

03

EBF 752

Current Issues in Islamic Finance

03

ii. Elective Courses

12 credits (4 courses)

To be selected from the list.

iii. Project/Inter nship with Islamic banks

03 credits

Every student will be required to take a project on a topic prescribed by the Department of Islamic Banking & Finance. The student will be assigned a supervisor for the purpose. Alternatively, the student will be required to join internship with an Islamic Financial Institution for a period of three to four months and submit a report to the department, which will be evaluated by a committee of examiners. List of Elective Graduate Courses for M.Sc (Islamic Banking & Finance)

Code

Title

Credit hours

Preferably one course from the following EFN 740

Financial Economics

3 credits

ECN 725

Monetary Theory & Policy

3 credits

ECN 753

Monetary & Fiscal Framework: Islamic Economy

3 credits

ECN 712

Fiqh al-Muamalat alMaliyyah al-Muqarin

3 credits

ECN 732

International Finance

3 credits

Three/Four courses from the following EFN 715

Islamic Banking & Financial Markets

3 credits

EFN 735

Multinational Corporations & Finance

3 credits

EFN 736

Analysis of Financial Statement

3 credits

EFN 737

Banking & Financial Markets in Pakistan

3 credits

EFN 740

International Business Strategy

3 credits

EFN 744

Project Appraisal & Management

3 credits

EFN 746

International Banking

3 credits

EFN 749

Banking Operations & Risk Management

3 credits

EFN 751

Treasury and Funds Management

3 credits

EFN 759

*Computer Packages for Banking & Finance

3 credits

EFN 760

Investment Analysis & Portfolio Management

3 credits

*Must not be allowed to students having studied similar course at B.Sc level

(c) 2003-2008 by International Islamic University, Islamabad Terms Of Use Privacy Statement

_min_icon_868_/images/min.gif_max_icon_868_/images/max.gif_max_text_Maximize_min_te xt_Minimize" name=__dnnVariable

Preparatory Maths & Statistics (Economics) This preparatory course starts in mid-September, about three weeks before the MPhil in Finance programme begins. Attendance is mandatory for all MPhil in Finance and MPhil in Financial Research students. It is taught by the Faculty of Economics and Politics. (This does not count towards your nine modules). The aim of this preparatory module is to review the required mathematical and statistical methods required for Microeconomics and Econometrics modules. The syllabus will include revision classes in linear algebra and statistics, optimisation, comparative statics and differential and difference equations. Those who do not attend the full preparatory course in Mathematics and Statistics will not be admitted onto the MPhil Finance/MPhil Financial Research programme. Back to top

Principles of Finance (Judge Business School) The aim of this module is to provide an introduction to the main foundations of financial theory and corporate policy. It is suitable for students who have not previously studied finance but does require some mathematical and statistical background. The module consists of two parts. The first part deals with the investment or capital budgeting decision. The second part focuses on the financing decision, or the way the investments are being financed. The first part will start with an introduction to the basic financial concepts of risk, return, net present value and the opportunity cost of capital. These concepts will then be

integrated into the valuation of financial assets where particular attention will be devoted to the pricing of options and other derivatives. These pricing models will then be applied to the valuation of corporate liabilities and real investments under uncertainty. The second part of the module will look at theories that try to explain the capital structure of firms and will involve a discussion of the impact of taxes and bankruptcy costs on the firm's financing decision. Assessed by examination. Back to top

Students can choose between the standard Quantitative Research Methods module or the advanced Econometrics module:

Quantitative Research Methods (Judge Business School) Introduction to the variety of quantitative research methods available for applied research in management, finance and economics. The purpose of this module is to provide students with sufficient background to choose techniques and methods suited to different data-sources and models. The focus is on the way techniques relate to theory, and on the insights that can be drawn from their application. We will be concerned with interpretation and appraisal of results, and will emphasise applied work. The topics in the Michaelmas Term will include: the paradigm: underlying "structure" and "true" models of phenomena, probability distributions, descriptive statistics, estimators and their properties, testing hypothesis, confidence intervals, simple and multiple regression, properties of regression coefficients, transformation of variables, linearity, nonlinearity and categorical variables, simultaneous equations, time series models, stationary and nonstationary processes, estimation. The topics in the Lent Term will include: binary choice, multiple choice and ordered response models, limited dependent variable techniques, duration and survival models, panel data estimation methods, nonparametric and semiparametric regression methods, count data models. Assessed by coursework.

Econometrics (Economics S300)

The aim is to provide a rigorous graduate level training in econometric theory with applications. Topics will include: the linear regression model, introduction to maximum likelihood and asymptotic theory; univariate time series models; multivariate time series models; nonstationarity and co-integration; model selection and testing; models of financial econometrics; computer packages and applications. The module consists of several components: • • • • • •

Regression, Estimation and Testing (Michaelmas Term) Time Series (Michaelmas Term) Computer Packages (Michaelmas Term) Dynamic Econometric Models (Lent Term) Financial Econometrics (Lent Term) Projects Meetings (Lent Term)

Those who do not attend the preparatory course in Mathematics and Statistics will not be permitted to take the Econometrics (S300) module. Assessed by examination and project. Back to top

Microeconomics for Finance (Economics S402) Only students with a prior background in intermediate microeconomics at the undergraduate level would be allowed to take Microeconomics for Finance and subsequently Asset Pricing. The Microeconomics for Finance lecturer would make the final decision on a student's eligibility to take the Microeconomics for Finance module, once students have arrived in Cambridge but before lectures begin in October. The Microeconomics course is compulsory if you wish to take the Asset Pricing course (S403) in the Lent Term. If you are hoping to be able to study the microeconomics module it would be very useful to study the relevant chapters in Varian before coming to Cambridge and work through the end-of-chapter questions (excluding chapters 11-13, 17, 26, 27, 34-36, in H.R. Varian, Intermediate Microeconomics: A Modern Approach, 6th edition 2003, W.W. Norton). The main components of the module are as follows: • • • • • •

Consumer, producer and social choice Decision-making under uncertainty General equilibrium theory Asset pricing Asymmetric information and the theory of contracts Game theory

•

•

Weekly classes at which problems related to the lectures will be discussed. These classes provide an opportunity for students to practise using advanced analytical methods, and are an essential feature of the module. During each term some problem sets will be marked, and feedback will be provided to enable students to assess their progress. There will be some seminars at which groups of students will collaborate to lead discussions of papers which illustrate the application of microeconomic principles to realworld problems.

Assessed by examination. Back to top

Introduction to Financial Reporting (Judge Business School) This module will cover how to build a formal accounting system to produce the balance sheet and profit and loss account for a simple business; and how to evaluate the annual report and accounts of a sophisticated listed company. The Introduction to Financial Reporting module is a pre-requisite for the Lent Term Financial Reporting and Capital Markets module, unless you have taken a similar accounting course before. Assessed by test and essay. Back to top

Globalisation and the Impact of Global Big Business (Judge Business School) This module examines the possibilities for catch-up in developing countries at the level of the large firm. It analyses the relationship between globalising large firms and the small and medium-sized enterprises that compose the rest of the global value chain. It combines theoretical and macro-level analysis with detailed empirical analysis of global change in a series of sectors: aerospace, pharmaceuticals, complex electrical equipment, autos and auto components, oil and petrochemicals, steel, mining, financial services and IT. It makes extensive use of in-depth case studies from large Chinese firms, supplemented with case studies, where available, from other developing countries. Assessed by essay.

Back to top

Distribution Networks (Judge Business School) The course is intended to introduce students to the economic and strategic issues arising from the sale of products and services across a distribution network. Distribution networks are affected not only by the emergence of specific technical capabilities which change relationships within the markets but also through the implementation of government policies and firm strategies in response to these technical developments. The interplay of these forces has lead to key structural changes in many markets, including industry privatisation and regulatory reform. However, these structural changes have caused controversy by raising fundamental questions about the rights of market participants and the appropriate rents to apply to network-mediated transactions. The course will introduce a series of case studies drawn from current issues on the internet, telecommunications, water, railway and electricity markets. The course will focus upon how economic analysis can be applied to the complex range of issues underlying recent developments in these network industries. By doing this we hope to illuminate how public policy and private strategies will develop in network industries in the future. Back to top

Risk Management and Real Options (Judge Business School) This module introduces students to the real options paradigm as a project design and evaluation tool. This paradigm emphasises the value of flexibility in project design and appraisal. Flexibility enables active risk and opportunity management as it allows engineers and managers to adapt the system in different ways, depending on how the future unfolds. Research and development (R&D) projects, for example, give companies the option of a future launch of a product, which they may or may not exercise, depending on the success of R&D and on market conditions. Similarly, building a small plant with an expansion option as opposed to building a big plant from the start gives the project manager the flexibility to expand if demand is high, without committing to high capacity a priori, thus avoiding "white elephants". Thus, flexibility has value. However, flexibility also costs money: R&D expenditure, for example in the biotech industry, can be huge. By building small and allowing for expansion the company foregoes the economies of scale of building one large plant. So how much flexibility shall we built into the system? System designers and project managers need tools that help them decide if added flexibility is worth the money. This module provides the students with a mindset and a suite of tools to tackle such problems. All participants are expected to be familiar with probability and statistics at the level of an introductory undergraduate course.

Back to top

Financial Reporting and Capital Markets (Judge Business School) This module's content consists of: Financial markets and the decisions informed by accounting data: subscription of new capital; market for corporate control; markets for debt and for executives. The efficient markets hypothesis. The general allocation problem with just semi-strong efficiency. Insider trading as a means of information release. Consequences of information asymmetry: plunder of principals' funds; misinformed investment decisions; withdrawal of investors from the market. Responding to information asymmetry: search; signalling; incentive contracts; audit; regulation. Creative accounting in an efficient market. Analysis of a series of case studies (recent UK and US company reports) grouped according to whether, first, cash flows are affected and, second, whether the creative accounting device is transparent. Fundamental values vs. market prices; dividend discount and dividend yield valuation models; sources of dividend growth; rate of return spread; interpretation of the price-earnings (PE) ratio; fundamentals of financial statements - accruals and cash flows; clean surplus accounting; the price-book value ratio; economic and accounting concepts of income; reporting financial performance; internal rate of return vs. accounting rate of return; abnormal earnings valuation model; Ohlson's abnormal earnings model; economic value added; shareholder value and enterprise value models. Pre-requisites: Introduction to Financial Reporting or equivalent. Assessed by essay. Back to top

Topics in Corporate Finance (Judge Business School) This course builds on material introduced in previous economics and finance courses. It extends some of the topics covered in corporate finance and introduces new areas emphasising the application of financial economic concepts and models to corporate financial and investment decisions. The following provisional list of topics indicates some of the intended content:

• • • • • • • • • • • • • • • •

Corporate finance - an overview The growth pattern of firms and their financial requirements The pecking order theory Credit rationing and finance gaps - debt and equity gaps Entrepreneurial finance - private equity, venture capital An overview of valuation methods such as the RADR and the CEQ The Venture Capital Method and the First Chicago Method of valuation The IPO process IPO costs Underwriting and selling Pricing the IPO Flotation - closing the IPO Post IPO - under pricing or overpricing? Corporate finance in an international environment The foreign exchange market International Capital Asset Pricing model (ICAPM)

Assessed by essay. Back to top

Asset Pricing (Economics S403) This subject offers a basic theoretical analysis of asset prices and general finance, which should serve as a good basis for more applied analysis. The lectures cover the following topics. • • • • • • • • •

Decision making under uncertainty Concepts of risk and risk aversion Stochastic dominance Portfolio theory Derivatives: options and futures Corporate bonds and warrants Term structure Credit risk Value at risk

This subject is built on the microeconomic principles and thus a solid understanding of microeconomics is indispensable. Its contents and exam questions are necessarily mathematical. The knowledge of linear algebra, calculus, convex analysis and probability theory is presumed throughout lectures. Assessed by examination.

Back to top

Topics in Empirical Finance (Judge Business School) This module has two parts. Part I provides an introduction to many of the topics that are in some way associated with the 'efficient markets hypothesis', which is an important part of the modem theory of finance. Part II will focus on mergers. The content of Part I will include: • • • • •

Introduction and overview The Efficient Markets Hypothesis and the early evidence on the profitability of investment strategies Stock market anomalies Do stock market investors overreact?: Mean reversion in stock prices Momentum in stock prices

Part II outlines the function of merger in corporate governance (the market for corporate control); it assesses the evidence on the effectiveness of the market for corporate control in the UK and US; it reviews the operation of alternative governance mechanisms in Germany; it outlines the traditional theories of synergistic merger; it assesses the evidence on the effect of merger on firm performance (market-based and accounting) in the light of traditional theories; and it reviews modern theories of merger consistent with recent evidence. It draws on both the company finance and industrial organisation literatures. A high level of student participation will be expected. For some sessions students will have to make presentations leading to classroom discussions. The module might be of interest to potential doctoral students in finance and those who intend to join financial institutions. Assessed by essay and project presentation. Back to top

Optimal Investment (Maths Part III)

The course will study a wide range of optimal investment/consumption problems that arise in theory and practice, and will discuss the usefulness of the conclusions. Most examples studied will be in a continuous-time setting. The following provisional list of topics indicates some of the intended content: • • • • • • • • • • • • • •

Self-financing portfolios and the wealth equation The Merton problem and its solution in the CRRA case, using the Hamilton-JacobiBellman approach The Merton problem, general case, by martingale representation The Merton problem, general case, using state-price density approach (Davis-Varaiya) martingale principle of optimal control Dual methodology and the Pontryagin principle Equilibrium pricing The equity premium puzzle Utility-indifference pricing Lagrangian martingale characterisation of optimal solutions Imperfections: transaction costs, portfolio constraints, parameter uncertainty, infrequent rebalancing Varied objectives: ratcheting of consumption, habit formation, recursive utility Backward SDEs and optimal control How good are any of these rules in practice?

Pre-requisites: a firm grasp of martingale theory, and a working knowledge of (Brownian) stochastic calculus will be required in the course. Assessed by examination. Back to top © Judge Business School, Trumpington Street, Cambridge, CB2 1AG, UK. Tel +44 (0)1223 339700