This book integrates classical and behavioral approaches to financial economicsand contains results that have been found only recently. It can serveseveral aims: as a textbook for a master or PhD course. Some parts can also be used onan advanced bachelor level, for self-study, as a reference to various topics and as an overview on current results infinancial economics and behavioral finance.In the following we want to give you some recommendations on how to usethis book as a textbook and for self-studying. Further information and sample
slides that can be used for teaching this book are available on the book’shomepage: http://www.financial-economics.de.The book has three parts: the foundations part consists of this introductionand a chapter on decision theory. The second part on financial markets buildsa sophisticated model of financial markets step by step and is also the core ofthis book. Finally, the third part presents advanced topics that sketch someof the connections between financial economics and other fields in finance. Inthe first two parts, every chapter is accompanied by a number of exercisesand tests (solutions can be found in the appendix). Tests are included inorder to enable self-studying and as an assessment of the progress made in achapter. Exercises are meant to deepen the understanding by working withthe presented material.