Module Catalogue 2024/25

Pre Requisite Comment

N/A

Co Requisite Comment

N/A

Aims

To provide students with the theoretical and methodological skills necessary to conduct policy and project appraisals, covering both private sector investment appraisal and public sector social cost-benefit analysis.

The module is concerned with the economic and financial appraisal of projects that are used in both private sectors and public sectors to examine whether investments are worthwhile or not. The module examines the methods used to appraise projects and considers the circumstances and difficulties that arise in applying these. In the case of the economic appraisal, or Cost-Benefit Analysis as it is known, this module covers the underlying theory of social decision-making for evaluating the welfare economic consequences of econonomic policies and projects. Cost Benefit Analysis is applied to evaluate initiatives within health, environmental, transport and natural resource policy. Often project benefits include non-market goods, and this module addresses the issues that arise when trying to estimate the total economic benefits and costs of society as a whole from a given project.

Outline Of Syllabus

The module starts with the basic notions underlying economic appraisal of projects. Thereby students get a common background before more advanced material is introduced and discussed. Throughout the module examples and cases are used to illustrate the material. The module include the following topics:

1. Dividends
2. Discounting, valuation of dividend streams, net present values
3. Welfare theoretic background of a Cost-Benefit analysis
4. Economic Evaluation of strategies for projects
5. Time horizon
6. Estimating costs
7. Valuing benefits; revealed preference methods (hedonic method and Travel Cost Method)
8. Valuing benefits; stated preference methods (Contingent Valuation)
9. Under certainty dividends and valuation. Sensitivity analyses in economic evaluation
10. Possibilities or real options in projects
11. Economic evaluation of real option and strategies for real options
12. Modelling projects and critical reflection on methods

Intended Knowledge Outcomes

To achieve the purpose of the module the student should:

- Prove knowledge of the underlying theory of investment appraisal and social cost-benefit analysis.
- Exhibit competency in being able to explain how to design a financial and economic project appraisal.

Intended Skill Outcomes

At the end of the module it is expected that the student will be able to:
- Describe the economic background of an economic and financial appraisal of a project
- Critically discuss the limitations of an appraisal of a project
- Describe the welfare theoretic background of a Cost-Benefit Analysis
- Identify costs and benefits for given projects
- Explain how costs and benefits can be estimated
- Locate and appraise some of the possibilities embedded in projects

Teaching Rationale And Relationship

The lecture material is intended to aid students to learn concepts, methods and applications. Seminars are intended to give hands-on experience of the material of the module.

Assessment Rationale And Relationship

The final mark will take into account each of the elements. The written exam will provide evidence of the depth as well as breadth of understanding of concepts and methods taught. The oral presentation of the group project will provide evidence of being able to critically use the material on applications.

Alternative assessment if we should move online due to public health changes:

Oral Presentation - we will move from in classroom to online presentation via zoom or teams.

In the case of an alternative assessment for semester 1 (60% of the module mark) being necessary due to circumstances, the Module Leader will in discussion with the DPD and the University, discuss possible acceptable online alternatives, such as a take home exam delivered online with a set time limit to complete (24 hours or less as deemed appropriate).

General Notes

N/A