Numbering Code	G-ENG01 5F223 LE24	Year/Term	2022 ・ Second semester
Number of Credits	2	Course Type	Lecture
Target Year		Target Student
Language	English	Day/Period	Wed.3
Instructor name	Cruz Ana Maria (Disaster Prevention Research Institute Professor)
Outline and Purpose of the Course	The aim of the class is to provide the basic knowledge of risk management methods for various types of risks such as natural disaster, environment and natural resources in urban and rural areas. Students will learn the decision making principle under risks in Economics and asset pricing methods in Financial Engineering as well as have exercises of application on public project problems.
Course Goals	It is targeted to understand 1) representative concepts of risk and risk management process, 2) expected utility theory and 3) foundation of Financial Engineering, and examine 4) public project problems by applying the above knowledge.
Schedule and Contents	Basic framework of risk management,2times,1-1 Representative concept of risk1-2 Risk management technologies Decision making theory under risks,3times,2-1 The Bayes' theorem2-2 The Expected utility theory Financial engineering,6times,3-1 The Capital Asset Pricing Model3-2 Option pricing theory3-3 The arbitrage theorem3-4 The Black-Scholes formula Decision making methods for projects,3times,4-1 The decision tree analysis4-2 The real option approach Comprehension check,1time,5 Comprehension check
Evaluation Methods and Policy	20% of score is valuated on attendance and discussion in classes, and 80% on reports.
Course Requirements	Fundamental understanding of probability
References, etc.	1.Ross, S.M.: An Elementary Introduction To Mathematical Finance, Cambridge University Press, 19992.Sullivan W.G.: Engineering Economy, Pearson, 2012
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