30366 - FINANCE (MODULE II) - CORPORATE FINANCE
Course taught in English
Class 24: NICOLAS ANDRE BENIGNO SERRANO-VELARDE, Class 26: FLORIAN NAGLER
The course is quantitative. To feel comfortable during the course, you should be familiar with basics in financial calculus (including time value of money, annuities and perpetuities), statistics (including probabilities, variances/covariances and ordinary least squares) and accounting (being able to read information contained in balance sheets, income statements, and cash flow statements).
This course serves as an introduction to modern corporate finance. Corporate finance is a set of principles that govern how businesses run. It is a study of how businesses should make financial decisions - ranging from investment choices to assessing the right mix of debt and equity. The course explores both investing and financing decisions, focusing on their role in the creation of shareholder value.
The course covers four main parts:
- The value of a firm - financial instruments, valuation concepts and decision rules.
- Risk and return - theory, empirical evidence and applications to capital budgeting.
- Financing decisions and market efficiency.
- Payout policy, capital structure and valuation.
- Recognize, explain, and reproduce core corporate finance tools and techniques, including applications in international contexts.
- Apply and interpret core corporate finance tools and techniques.
- Apply and evaluate capital budgeting methods.
- Analyze and assess corporate financial decisions, such as capital structure and corporate payout decisions.
- Face-to-face lectures
- Exercises (exercises, database, software etc.)
- Case studies /Incidents (traditional, online)
- Individual assignments
- Group assignments
- Excercises: students work on exercises in class and as take-homes.
- Case studies: several case studies are designed to give students a sense of solving allegedly real problems facing a firm.
- Individual assignments: students work through roughly one dozen individual graded assignments throughout the course, these serve primarily to help students synthesize the material.
- Group assignments: groups of students work on graded group assignments (cases).
|Continuous assessment||Partial exams||General exam|
Course assessment is identical for attending and non-attending students. Course assessment consists of:
- A final exam (50-100% of the final grade): the exam is in written form, comprehensive, and closed-book. It consists of open questions and multiple choice questions, both qualitative and quantitative, aimed at assessing students' ability to apply the analytical tools and institutional knowledge covered during the course. The weight of the final exam depends on the quality of the other components and ranges from 50% to 100%.
- Case studies (0-20% of the final grade): the case studies are worked on (and handed in) in groups, and are designed to give students a sense of solving allegedly real problems facing a firm. Students are able to re-shuffle groups between cases. Since there is one grade per group, students need to make sure that every group member pulls his or her weight. Students will be assessed by the quality of their recommendations and analysis, the soundness of their logic, by their overall exposition (writing and style), and by their ability to effectively deal with ambiguity in a business setting. The weight is 20% if better than the final exam, and 0% otherwise.
- Take-home quizzes (0-30% of the final grade): the take-home quizzes - of which there are roughly 10 - are individually assigned to students and contain numerical exercises and other question types and are aimed at helping students synthesize the course material and assessing their ability to apply analytical tools and their institutional knowledge. The weight is 30% if better than the final exam, and 0% otherwise.
- Unused case and take-home grade components have expiration conditions, the details are covered in class.
- FAQ: An up-to-date guide to Frequently Asked Questions about the course (on Bboard).
- Textbook: R. BREALEY, S. MYERS, F. ALLEN (BMA), Principles of Corporate Finance, McGraw Hill, 13th edition.
- Course note packet: there is a course pack of class lecture notes (on Bboard).
- Cases: a set of cases we work through in class (on Bboard).
- Pre-readings: please see the course notes for some basic pre-reading to be done before the course formally begins (on Bboard).