Corporate Finance Syllabus Spring 2009 Prof. Anna Scherbina UC Davis Graduate School of Management Office: 126 AOB IV Tel: 530.754.8076 e-mail: ascherbina@ucdavis.edu Course Focus We will explore how corporations make financial decisions through the analysis of Harvard Business School cases. Should a firm undertake a new investment opportunity‚ raise equity‚ acquire another firm‚ or conduct an IPO? How should small firms manage their working capital? How fast should a firm grow
Premium Cash flow Corporate finance Finance
1.1 The Role of The Financial Manager LEARNING OBJECTIVE 1 Identify the key financial decisions facing the financial manager of any business firm. The financial manager is responsible for making decisions that are in the best interests of the firm’s owners‚ whether the firm is a start-up business with a single owner or a billion-dollar corporation owned by thousands of stockholders. The decisions made by the financial manager or owner should be one and the same. In most situations this means
Premium Asset Corporation Corporate finance
-Martin Industries just paid an annual dividend of $1.30 a share. The market price of the stock is $36.80 and the growth rate is 6.0 percent. What is the firm’s cost of equity? RE = [$1.30 × (1 + 0.060)] / $36.80 + 0.060 = 0.097446 = 9.74 percent (3) - The Bet-r-Bilt Company has a 5-year bond outstanding with a 4.30 percent coupon. Interest payments are paid semi-annually. The face amount of the bond is $1‚000. This bond is currently selling for 93 percent of its face value. What is the company’s
Premium Stock market Stock Dividend
Subject: Corporate Finance (3 credits) Reference book: 1. Essentials of managerial Finance: Harcourt College 2000 2. Fundamentals of financial management: Mc Graw Hill 2007 Chapter 01: An overview of Finance What is finance? Finance is concerned with decisions about money (cash flows) Finance decisions deal with how money is raised and used Everything else being equal: * More vale is preferred to less * The sooner cash is received the more value it has * Less risky
Premium Corporate finance Financial ratio Cash flow
1. For our course‚ "Finance" means the _____ and "Business Finance" means the _____. A. management of money invested in business assets expected to increase in market value or otherwise pay a fair return; management of money invested in assets expected to increase in market value or pay a fair return. B. study and application of Accounting principles as they pertain to any organization; study and application of Accounting principles as they pertain to a business. C. management of money invested
Premium Finance Economics Investment
a model of a fair game where knowledge of past events never helps predict the mean of the future winnings ) . The Efficient-Market Hypothesis was developed by Professor Eugene Fama 1965. It was widely accepted up until the 1990s‚ when behavioral finance economists ‚ who had been a fringe element‚ became mainstream . Empirical analyses have consistently found problems with the efficient-market hypothesis . Efficient Market Hypothesis : (EMH) is the theory behind efficient capital markets. An efficient
Premium Financial markets Economics Fundamental analysis
What questions should you answer when assessing your needs or goal in owning a home? A recent study shares seven questions that a first-time home buyer should consider as an answer when owning a home. 1. Is owning the roof over your head your No. 1 priority? "Your answer is going to be determined on the other things you’ve got going on in your life. Have you started saving for retirement‚ or are you planning to begin soon? Purchasing a home should coordinate closely with the rest of your priorities
Premium Real estate Economics Finance
Case Studies in Finance: Managing for Corporate Value Creation Fourth Edition July‚ 2002 Robert F. Bruner Distinguished Professor of Business Administration Darden Graduate School of Business Administration University of Virginia Post Office Box 6550 Charlottesville‚ Virginia 22906 Email: brunerr@virginia.edu Web site: http://faculty.darden.edu/brunerb/ ABSTRACT: This book presents 46 case studies in finance‚ targeted toward upper-level undergraduates and introductory and intermediate-level MBA
Premium Corporate finance Finance Weighted average cost of capital
Problem set 2 16-1. Gladstone Corporation is about to launch a new product. Depending on the success of the new product‚ Gladstone may have one of four values next year: $150 million‚ $135 million‚ $95 million‚ and $80 million. These outcomes are all equally likely‚ and this risk is diversifiable. Gladstone will not make any payouts to investors during the year. Suppose the risk-free interest rate is 5% and assume perfect capital markets. a. What is the initial value of Gladstone’s equity
Premium Corporate finance Stock market Finance
PART 1. Total 40 marks ( 2 marks each). MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Assume that you borrow $2000 at 10% annual interest to finance a new business project. For this loan to be profitable‚ the minimum amount this project must generate in annual earnings is 1) _______ A) $201. B) $200. C) $400. D) $199. 2) Which of the following statements about the characteristics of debt and equities is true? 2)
Premium Investment Finance Bond