• Apply capital budgeting techniques and perform basic valuations
• Explain when and how taxes, risk management, agency problems, and asymmetric information affect the optimal capital structure, payout policy, and firm values
• Explain the likely implications of agency problems and asymmetric information in other issues including IPOs, bank lending, equity issuance, ownership structure, investment decisions, risk management, and informationally efficient financial markets
• Reflect on models examining issues like payout policy and capital structure in a dynamic setup
• Put theoretical insights into perspective when applied in a practical contexts

The course provides students with a research based knowledge and understanding of core topics in corporate finane focusing on the implications of asymmetric information and agency conflicts. The following topics will be covered: Classical Modigliani-Miller propositions, the effect of taxation, optimal capital structure, corporate valuation, dividend policy, capital budgeting/real options issues, risk management, and capital structure choice in dynamic settings. The course is a fundamental finance course. It complements the courses on Asset Pricing Theory and Corporate Governance.

Part of this course may also be taken as a PhD course for a limited number of PhD students.

The main textbook can be bought in the CBS bookstore, online at different places, and probably also used, if you like. The articles will be uploaded in LEARN in due time before class. All slides, exercises not in main textbook etc. used for lectures will be uploaded in LEARN before class. These slides will also be part of the required readings for the exam. In particular, the slides will clearly demonstrate what you should be focusing on when reading the main textbook or the assigned articles.