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Financial economics is the branch of economics characterized by a "concentration on monetaryactivities", in which "money of one type or another is likely to appear on both sidesof a trade".Its concern is thus the interrelation of financial variables, such as prices, interest ratesand shares, as opposed to those concerning the real economy.It has two main areas of focus: asset pricing (or "investment theory") and corporate finance;the first being the perspective of providers of capital and the second of users of capital.The subject is concerned with "the allocation and deployment of economic resources, bothspatially and across time, in an uncertain environment".It therefore centers on decision making under uncertainty in the context of the financialmarkets, and the resultant economic and financial models and principles, and is concerned withderiving testable or policy implications from acceptable assumptions.It is b

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