Bringing learning to life via interactive finance tools
Pearson’s author webinar series “Changing Perspectives”.
Authors of market-leading ‘Corporate Finance’ Johnathan Berk and Peter DeMarzo, spoke about the interactive tools available to students and educators with the textbook's new edition, and shared their personal tips on how to engage students with this fascinating subject.
The YouTube video of the webinar is available:
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Engaging students in finance: teaching tips and tools for Gen-Z
One of the main topics discussed in this webinar was how to engage younger cohorts of students and those who don’t have a natural interest in finance.
The authors expressed that the most effective way to engage these students is to make finance more relevant. Showing students the value of finance and how it relates to real-world events that can personally affect them, can greatly increase their interest.
On that basis, the advice given to our audience was to bring trending topics in the news into the classroom and highlight how the knowledge of finance can help them obtain a deeper understanding of the events. Doing so not only piques their interest in topical discussions but underlines the value of finance as a discipline.
Finance is not as complex as students think!
Another important factor that impacts student engagement is how easily they can be discouraged by the seeming complexity of the subject.
The authors stressed the need to emphasise that finance is not impossibly complex, but the basic principles are very simple. As an effective way to help students identify these basic principles in the classroom, the authors explained they have included ‘Common Mistakes’ boxes in the book. These boxes show how businesses can go wrong and why finance principles are important to correct those errors, making the value of the subject clearer to students and stimulating their interest.
Incorporating interactive tools in finance education
The authors demonstrated the interactive tools available with the new edition of Corporate Finance, and highlighted the ways educators can bring them into the classroom to enhance student engagement and understanding.
The main value of the tools is their ability to elucidate current events in the light of finance. Where students may feel intimidated or bored by finance, these tools demonstrate how financial principles relate to the world around them.
The authors maintain that the versatility and capability of these tools to visualise data is the greatest advantage of using them, allowing academics to adapt and apply them to events as they occur. For instance, the authors were able to take the example of the Silicon Valley bank failure and use it in the webinar as a live example.
Learning through play with visualisation tools: top tips
A benefit of these tools is their ability to help students visualise data. But more than visualising in the same way static graphs or charts might do, interactive tools let students visually understand how certain metrics and principles will affect the data overall.
An important tip, according to the authors, is to allow students to experiment with the visualisation tools, as an essential step to understanding the concept behind them. This process will let students realise their value and how to use it in order to find the best solutions to a scenario without simply being told.
Stock data on the digital dashboard - a demonstration
The authors demonstrated the tools available from the digital dashboard of their new book using real-time stock data. Asking students questions about this data and considering how it can affect their decisions on a virtual investment portfolio will prompt them to think around the principles behind the tool and help them understand wise investment options.
This method of experimenting with digital tools also allows for a more constructive discussion in class, which helps them understand the effects of their decisions and analysis.
A Beta version of this dashboard is available for educators to try. Fill out this form before 15th May and explore these tools for yourself.
Emphasising conceptual questions
A final yet essential tip the authors stressed was the importance of teaching contextual questions rather than simply offering students formula practice. Educators should offer conceptual questions that help students understand the principles behind the theory rather than getting them to memorise equations.
Top Tip!
You can create a conceptual bank and then change imagined interest rates to stimulate a group discussion in class around the possible outcomes.
Finance education amidst the rise of AI tools
A question submitted in the session asked the authors to consider the impact of ChatGPT in the teaching delivery of finance.
While the authors find that ChatGPT does not currently answer basic finance problems very well, they acknowledged it will get better and become increasingly important. Despite its capability to solve formulae, it will not be able to understand how to apply those formulae conceptually for the foreseeable future.
The rise of ChatGPT and AI technology, however, will force educators to test concepts and not calculations. For that reason, they stressed, it is essential for academics to emphasise the importance of learning finance the right way, which is not in the calculations, but the ways of thinking and approaching the financial problems.