CORPORATE
FINANCE: BusFin
1311
FALL 2010
Wednesday
6:30 p.m.
Office Hours: Wednesday 5:00 p.m.-6:00 p.m. or by appointment
Welcome to Corporate Finance! This course will focus on learning and
mastering methods to maximize firm value.
We will also utilize lectures, discussion, problems and cases to hone
your financial skills. This course
builds on the tools and framework from the Introduction to Finance course and
introduces the results of recent research.
The mission is to learn topical and effective financial management
skills which are applied in progressively more complex and realistic
situations.
This web site is a work in progress, if you find a broken link or something else wrong, please email me.
The current edition of the recommended text book is not appreciably different from previous recent editions so you may use an older edition. In the readings below I have the sections for the 8th and 9th editions listed. However, it is your responsibility to make sure that the reading assignments are the same. I am not concerned about sentences being different, rather you need to make sure that Section X.X in the 8th edition is the same as Section X.X in your edition. I will put a copy of the book on reserve at the library.
Time value of
money and bond valuation review.
Class Notes: Save these notes to your
hard drive. If you want a hard copy,
print them as "notes pages" from Powerpoint.
(File, Print, Print What-"Notes Pages")
Overview of
Corporate Finance and Agency Issues
Problem Sets
Problem Set 1- Questions Problem Set 1 – Answers Problem Set 1-Answers(spreadsheet)
Problem Set 2-Questions Problem Set 2-Answers
Problem Set 3-Questions Problem Set 3-Answers
Problem Set 4-Questions Problem Set 4-Answers Problem Set 4-Answers(spreadsheet)
Tentative Course Outline
Note: The course schedule is approximate and subject to change with
appropriate notice. If there are changes, they will be posted here.
To the best of my ability, I tested the electronic document delivery
and it works from a variety of internet connections. However, this does
not guarantee that you will be able to access the documents from every type
of internet connection at all times. Well in advance of each class,
please try to access the documents and download them if possible, if you have a
problem contact me via email and we will solve the problem.
CLASS SCHEDULE
Except for dates for the exams, dates in
the course schedule are approximate and subject to change with appropriate
notice. The RWJ textbook readings for
both the 9th and 8th editions are listed. When they are different, the 8th
edition readings are in brackets [].
Week of Topic Text
Book Readings
August 29 Overview of Corporate Finance/Agency Issues (RWJ) Ch 1: Sections 1.1-1.4
Additional Required
The
Nature of Man (Jensen and Meckling, Foundations
of Organizational Strategy)
Focus on the portion of the article that emphasizes REMM
Agency
cost of overvalued equity (Michael Jensen,
Just say no to Wall Street (Joseph Fuller and Michael Jensen, Journal of Applied Corporate Finance)
Efficient Markets, Deficient Governance (AmarBhide, Harvard Business Review)
Best Practices in Corporate Governance: What two decades of research reveals (Shivdasani and Zenner, Global Corporate Finance)
September 5 Overview/Agency Issues (continued) (H) Ch 1-4, 23 (complete by Sept 13)
September 12 Overview/Agency
Issues (continued)
September 19 Capital Budgeting/Excel Modeling (RWJ) Review Chapter 5 [6]
Ch 6, 18.1-18.4, 7.1, 7.2,
[7, 17.1-17.4, 8.1, 8.2]
(H) Chapter 9
September 26 Capital Budgeting/Excel Modeling (cont) (H) Chapter 12, 14.2
Bond and Stock Pricing (Wednesday) (RWJ) Review Ch 4,5 [4,5] Focus on Ch 4.4, 5.5-5.7 [4.4, 5.5-5.7]
October 3 Excel Quiz
Case 1: Voting Question
October 10 Bond and Stock Pricing (continued)
Cost of Capital (You will only be responsible for first four slides for the exam)
Exam
October 17: Cost of Capital (RWJ) Chapter 11.8, 11.9 [10.8, 10.9]
(H) Optional: Chapter 7
Additional Required
October 24 Capital Structure (RWJ) Chapters 16, 17 [15, 16]
(H) Chapter 21
Case 2: Voting Question
October 31 Capital Structure (cont)
Introduction to Real Options (RWJ) Ch 22 & 23, 7.3, 7.4 [22 & 23, 8.3, 8.4]
November 7 Real Options (cont)
November 14 Real Options (cont) (H) Chapter 18-20 (will complete some in class)
November 21 Real Options/Excel Modeling (cont)
Thanksgiving (No Class Wednesday)
November 28 Real Options/ Excel Modeling (cont)
December 5 Excel Quiz
Case 3: Voting Question
Week of December 12 Exam-TBA