## Breadcrumb

## Breadcrumb

# Assessment of Adequacy of Personal Readiness

If you graduated with a grade **greater or equal to 99/110**, regardless of the degree you earned, your graduating class, and your home university, **You DO NOT HAVE to take** the Personal Readiness Verification.

Undergraduates who have passed all exams and direct-access graduates who have met the requirements and obtained a grade below 99/110 must pre-register and take an oral interview focusing on the fundamental knowledge needed to attend the E&DS Master's program.

The oral interview will be conducted remotely.

The Board of Teachers will declare ineligible students who demonstrate serious deficiencies and for this reason will not be allowed to enroll. Students declared ineligible will be allowed to freely repeat the oral interview until eligibility is achieved.

The test will be held remotely in July, September, November and February. Dates will be posted annually on the department's website.

Students should be familiar with the main concepts taught in the three-year basic economics courses (basic mathematics, financial mathematics, statistics, business economics, micro and macroeconomics). They may use textbooks and/or course notes for their preparation. Alternatively, they may use the materials indicated on this webpage. The topics to be assessed are given below.

Students should focus on the definitions of the main topics taught during the bachelor's degree in the above areas, particularly the topics listed below.

###
### Economy

### Economy

With regard to the economic area, admission test questions will focus on the main topics of microeconomics and macroeconomics. In particular, students should be able to answer questions on:

- consumer theory
- the theory of the firm
- market structures
- the determinants of aggregate demand
- the IS-LM model
- the Phillips curve

**References:**

Frank, R.H., Cartwright, E. (2020), Microeconomics and behavior, 3rd edition, McGraw-Hill Education (ISBN: 1526847841).

Frank, R.H., Cartwright, E., Piras, R. (2021), Microeconomics, 8th edition, McGraw-Hill Education (ISBN: 883869706X).

Blanchard, O. (2021), Macroeconomics, 8th edition, Pearson (ISBN: 9780136713883).

Blanchard, O., Amighini, A., Giavazzi, F. (2021), Discovering macroeconomics: what you can't not know, Il Mulino (ISBN: 9788815290168).

- What is a demand curve? .
- Describe the elements that go into a consumer's budget constraint.
- What is a supply curve?
- Define the notions of total cost, average cost, and marginal cost.
- What are the main differences between a monopolistic and an oligopolistic market?
- What are the determinants of aggregate demand in an open economy with a public sector?
- Describe the instruments and effects of fiscal policies on the economic system.
- Describe the instruments and effects of monetary policies on the economic system.
- What is the relationship between inflation and unemployment?

###
### Mathematics and financial calculus

### Mathematics and financial calculus

- General facts about real functions. Elementary functions and their graphs; geometric transformations. .
- Differential calculus. Definition of derivative and its geometric interpretation; derivatives of elementary functions; rules of differentiation; relationship between sign of the derivative and monotonicity of the function.
- Linear algebra. Algebraic operations with vectors and matrices; determinant of square matrices. .
- Financial Calculus. Simple and compound interest rates; annuities (present value, final value, perpetual annuities); amortization schedules.

**References**

Peccati - Salsa - Squellati, "Mathematics for Economics and Business," (EGEA) covers all the required content.

For the content of financial calculus, you can also consult the material available at the following link: https://web.uniroma1.it/memotef/sites/default/files/file lectures/Financial Mathematics handouts 2017_0.pdf

- Draw the graph and illustrate the main characteristics (domain, limits, monotonicity) of the exponential/logarithmic/power function.
- Give the definition of derivative for a real function and illustrate its geometric meaning.
- Write the rule of differentiation for the product/ratio/composition of two functions.
- Calculate the product of two given matrices.
- Describe how capital is accumulated starting from an initial sum C invested for N years with the annual interest rate I in the case of simple interest and compound interest (with annual compounding).
- Let us consider time in years. Let C be an amount due in N years and let D be the annual discount rate. Write the formula for the present value of C in the case of simple discount and in the case of compound discount.

###
### Statistics

### Statistics

**The****probability**.

The "concept" of probability. Kolmogorov's axioms.

The binomial distribution and its properties.

The normal distribution and its properties.

Inference

Population and sampling

The sample mean

Confidence intervals for the mean of a normal distribution

The logic of hypothesis testing

Tests for the mean of a normal distribution

**Modeling**

Correlation

Simple regression

**References:**

or (in Italian)

- Borra- Di Ciaccio, Statistics. Methodology for the Economic and Social Sciences, Mc Graw-Hill .

- What is the binomial distribution and its characteristics? .
- Describe the main properties of the normal distribution.
- Introduce the sample mean distribution for normal samples.
- Illustrate the confidence interval for the mean of a normal distribution and its significance.
- Illustrate the definition and properties of the correlation coefficient.
- How is the regression line constructed?

###
### Business

### Business

**A) Business and administration**

- Basic concepts on financial statements
- Notes on the main budget documents
- Information purposes of financial statements
- Basic profitability indicators (EBITDA, RoE, RoI, RoA...)
- Financial balance indicators
- Sources and uses of funds concepts
- Main business functions and their tasks
- The meaning of the break-even point (BeP)

**B) Financial instruments and operators**

- Basic concepts of financial instruments
- Fundamentals of financial risks
- The role of banks and financial intermediaries

**References:**

P. M. Ferrando - M. Zuccardi Merli, Capital and income in the functioning of the business system, Giappichelli, Turin, latest edition.

Hull J. C. - Options, futures and other derivatives, Pearson, 2017.

Remains A., Sironi A. - Risk management and shareholder value in banking, John Wiley and Sons, 2007.

**A)**

.
1. What kind of data can be found in the balance sheet assets?

.
2. What does RoI mean and how can it be used?

3. What data do you need to derive a BeP?

4. What are the main objectives of the human resources function?

5. What is the "Marketing" function?

**B)**

6. What are the most popular types of fixed income?

7. What are the main risks that a risk management must manage?

8. What is the role of rating agencies?

9. How does a clearinghouse work?

10. What is an interest rate derivative?