Course detail

Economy of Investment

FAST-BVA008Acad. year: 2022/2023

Investment and national economy. Investment area (return, risk and liquidity). Time value of money. Feasibility study. Evaluation of economic efficiency and financial feasibility of structural investment projects. Procedures and methods for future development simulation of project. Economic efficiency ratios. Risk and uncertainty.

Language of instruction

Czech

Number of ECTS credits

6

Mode of study

Not applicable.

Guarantor

prof. Ing. Jana Korytárová, Ph.D.

Department

Institute of Structural Economics and Management (EKR)

Learning outcomes of the course unit

Creation of models for calculation of economic and financial feasibility of investment projects. Feasibility study.

Prerequisites

Knowledge of financial and taxation issues and orientation in construction cost estimates.

Co-requisites

Not applicable.

Planned learning activities and teaching methods

Not applicable.

Assesment methods and criteria linked to learning outcomes

Not applicable.

Course curriculum

1. Investment and economy growth, sorts of investment possibilities.
2. Theoretical appraisal for evaluation of economic efficiency of investment, time value of money.
3. Technical and economic study of the investment project – Feasibility study.
4. Specification of revenues and costs in various stages of the life cycle of the project.
5. Financing of construction investment projects, resources and costs.
6.–7. Creation of data for economic evaluation of investment projects, determining cash flows, methods for determining the discount rate.
8.–9. Economic analysis of investment projects – calculations of NPV, IRR, LCC and their interpretation.
10. Analysis of sources and causes of uncertainty, inflation.
11. Profitability analysis, break even point.
12.–13. Sensitivity analysis, qualitative and quantitative risk analysis.

Work placements

Not applicable.

Aims

Goal of this subject are knowledge and skills regarding to describe and analysis variables as inputs into calculation of economic efficiency. Creation of models for calculation of economic and financial feasibility of investment projects.

Specification of controlled education, way of implementation and compensation for absences

Extent and forms are specified by guarantor’s regulation updated for every academic year.

Recommended optional programme components

Not applicable.

Prerequisites and corequisites

Not applicable.

Basic literature

FOTR, Jiří a Ivan SOUČEK. Investiční rozhodování a řízení projektů, Praha: Grada Publishing, a.s., 2011 (CS)
KORYTÁROVÁ, Jana. Ekonomika investic (el. stud. opora FAST VUT), 2020 (CS)
BAUM, Andrew. Real Estate Investment. A Strategic Approarch. Routledge, New York, 2022. ISBN 9780367690694. (EN)
FURFINE, Craig. Practical Finance for Property Investment. Routledge, New York, 2020. ISBN 9780367333041. (EN)

Recommended reading

Not applicable.

Classification of course in study plans

  • Programme BPC-SI Bachelor's

    specialization E , 4 year of study, winter semester, compulsory

Type of course unit

 

Lecture

26 hod., optionally

Teacher / Lecturer

prof. Ing. Jana Korytárová, Ph.D.

Syllabus

1. Investment and economy growth, sorts of investment possibilities. 2. Theoretical appraisal for evaluation of economic efficiency of investment, time value of money.

3. Technical and economic study of the investment project – Feasibility study.

4. Specification of revenues and costs in various stages of the life cycle of the project.

5. Financing of construction investment projects, resources and costs.

6.–7. Creation of data for economic evaluation of investment projects, determining cash flows, methods for determining the discount rate.

8.–9. Economic analysis of investment projects – calculations of NPV, IRR, LCC and their interpretation.

10. Analysis of sources and causes of uncertainty, inflation.

11. Profitability analysis, break even point.

12.–13. Sensitivity analysis, qualitative and quantitative risk analysis.

Exercise

26 hod., compulsory

Teacher / Lecturer

prof. Ing. Jana Korytárová, Ph.D.

Syllabus

1. Basic ratios for evaluation of the economic efficiency of investment.

2. Returns and inflation, the internal rate of return calculation, calculation example of bonds.

3. Calculation of the real net present value.

4. Calculation of life cycle costs.

5. Analysis of uncertainties – profitability analysis.

6. Analysis of uncertainties – sensitivity and probability analysis.

7. Assignment of project – production of wooden windows.

8. Continuation of project – resources of business plan financing.

9. Continuation of project – profit and loss statement, cash flow statement.

10. Optimization of financial resources - credit, leasing, bonds.

11. Continuation of optimization of financial resources.

12. Credit test.

13. Credit.