| Learning objectives |
The aim of the course is to provide students a
thorough understanding of central issues in corporate finance and
of models that are useful for analyzing such issues in a structured
manner. At the end of the course, students should be able to:
- Analyze the profitability of corporate investment opportunities
with the purpose of supporting capital budgeting decisions
- Explain the different funding options for a firm at its
different stages as it growths from a startup to a public company
taking into account the possible funding sources and optimal
capital structure decisions considering, e.g., tax effects and
potential bankruptcy costs
- Analyze the dividend policy of the firm
- Analyze how corporate decisions are influenced by agency
problems and explain how agency problems can be countered.
- Apply option pricing theory to analyze firms' capital
structure, to price debt and equity, and to analyze investment
opportunities
- Analyze leasing opportunities
- Analyze and value mergers and acquisitions
proposals
|
| Examination |
|
Corporate
Finance:
|
| Exam
ECTS |
7,5 |
| Examination form |
Written sit-in exam on CBS'
computers |
| Individual or group exam |
Individual exam |
| Assignment type |
Written assignment |
| Duration |
4 hours |
| Grading scale |
7-step scale |
| Examiner(s) |
Internal examiner and external examiner |
| Exam period |
Autumn |
| Aids |
Open book: all written and electronic aids,
including internet access
|
| Make-up exam/re-exam |
Same examination form as the ordinary exam
If the number of registered candidates for the make-up
examination/re-take examination warrants that it may most
appropriately be held as an oral examination, the programme office
will inform the students that the make-up examination/re-take
examination will be held as an oral examination
instead.
|
|
| Course content and structure |
|
The course focuses on three major decisions of corporations: the
investment decision (i.e., where and when to invest a firm’s
resources), the financing decision (i.e., how to finance a given
investment), and the dividend decision (i.e., how much and when to
pay out to shareholders).
The following topics are treated: risk and the cost of capital,
valuation and investment planning, real options, capital structure,
credit risk, dividend policy, risk management, agency costs and
benefits, mergers and acquisitions.
The course focuses on the themes related to Chapters 14 to 28 of
the textbook. Students are encouraged to familiarize
themselves with the topics related to the first part of the book
(I.e., Chapters 1-13) before the course starts. These topics
are included in most bachelor degree corporate finance
courses. The first lecture of the course will give a short
overview of the topics from the first part of the book which we
need for the rest of the course.
|
| Description of the teaching methods |
| Lectures, cases and exercices. |
| Feedback during the teaching period |
| Students are strongly encouraged to actively take
part of both the lectures and the exercise sessions by contributing
with questions and comments. The teacher will do his best to give
appropriate feed-back. In addition, students will have two
opportunities (around week two and week four) to hand in written
solution proposals to assigned exercises upon which they will
receive explicit feed-back on their individual solutions. The
teacher will also provide a general solution proposal to these
exercises and there will be extra exercise sessions where the
solutions will be discussed. The weekly office hour will be
organized as an in-class consultancy lecture (lektiecafé), where
students can come and work on their exercises, ask questions on an
individual basis and thereby get individual feed-back. |
| Student workload |
| Lectures |
33 hours |
| Preparation for lectures |
66 hours |
| Exercise classes |
14 hours |
| Preparation for exercise classes |
70 hours |
| Exam |
4 hours |
| Final preparation for exam |
19 hours |
|
| Expected literature |
|
Berk, J., P. DeMarzo (2017). Corporate Finance,
4th Edition (Global Edition). Pearson.
Selected articles.
|
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