English   Danish

2021/2022  BA-BIBAO3021U  Principles of Corporate Finance

English Title
Principles of Corporate Finance

Course information
Language English
Course ECTS 7.5 ECTS
Type Mandatory
Level Bachelor
Duration One Semester
Start time of the course Spring
Timetable Course schedule will be posted at calendar.cbs.dk
Study board
Study Board for BSc in Business, Asian Language and Culture
Course coordinator
  • Björn Preuss - Department of International Economics, Goverment and Business (EGB)
Main academic disciplines
  • Finance
  • Economics
Teaching methods
  • Blended learning
Last updated on 17-05-2021

Relevant links
Learning objectives
At the exam the student should demonstrate that s/he can live up to the following learning objectives:
  • Define and discuss key concepts from theories and models introduced and discussed in the course.
  • Apply the correct financial techniques to a given issue.
  • Calculate and perform the analysis from the perspective of a chief financial officer in decision-making.
  • Interpret the results of the analysis with respect to the efficiency of decision making.
Examination
Principles of 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-point grading scale
Examiner(s) Internal examiner and external examiner
Exam period Summer
Aids Limited aids, see the list below:
The student is allowed to bring
  • Non-programmable, financial calculators: HP10bll+ or Texas BA II Plus
  • Language dictionaries in paper format
The student will have access to
  • Advanced IT application package
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.
Description of the exam procedure

 

 
Course content, structure and pedagogical approach

This course is an overview of the principles of corporate finance and is designed for undergraduate students who have no prior knowledge of corporate finance. Importance is placed on techniques related to investment decisions and financial decisions made by companies. Financial managers in corporations work with other managers to identify investment opportunities, to analyze and value the opportunities and to decide whether and how much to invest, as well as decide how to raise the money to finance corporation’s investments.
Therefore we start with an introduction of what corporate finance is and describe the role of a corporation’s financial manager. We then proceed with how to measure corporate performance (value added, efficiency, profitability etc), since the main goal of corporations is maximizing the current market value.
Since companies invest in a lot of things such as tangible or intangible assets, the decision on capital outlays is among the most significant a firm will have to make. In introducing decision making on capital expenditure, first the students will be exposed to “time value of money” calculations and then proceed to the fundamentals of valuation of bonds and stocks, emphasizing present value techniques. These techniques will be also useful during capital budgeting decisions, which involve comparing the different investment criteria in the presence of capital shortage. After careful grounding in valuation practice and theory, the concepts of the cost of capital and capital structure will be examined, covering risk-return analysis in capital budgeting. In the end the students will get an additional overview about more advanced financial instruments such as options.
Description of the teaching methods
A mix of lectures, exercises, and casework held both online and in the classroom. Cases, when necessary, will be made available to students. The course is designed as a blended learning course. With this, some lectures and exercises will be online and others will be on campus.
Feedback during the teaching period
Students receive continuous feedback in the exercise sessions where they are asked to apply concepts of CF. During class, we discuss concepts, and students are actively involved in the discussion giving them the opportunity to get direct feedback on their way of thinking about corporate finance theories and concepts.
Throughout the application of quizzes in canvas, the students get after making a quiz direct feedback from the teacher or the system. In the case of pre-recorded videos using the panopto software, we incorporate related questions with direct feedback after the answer submission.

The exercises, quizzes, and discussions are linked to some of the learning objectives of this course, which means that feedback activities can help you familiarize yourself with the assessment method of the course as well as to provide you with a clear indication of the standards expected from your work. Further feedback by teachers is offered in response to questions by individual students or groups. Students are at all times able to reach the teacher by email to ask questions or book meetings if needed.
Student workload
Lectures 30 hours
Exercises 12 hours
Preparation (i.e. hours spent for reading, group work, etc.) 160 hours
Examination 4 hours
Further Information

The course is designed for undergraduate students who have no prior knowledge of corporate finance. Therefore, the course is especially integrated with the IBA courses in Microeconomics and Accounting, as well as the other courses of IBA.

 

Please note that this course is new and will be offered for the first time in spring 2021 in the new IBA structure following the IBA programme reform.
Expected literature

Main Text Book

  • Richard A. Brealey, Steward C. Myers, and Alan J. Marcus. Fundamentals of Corporate Finance. (latest edition) McGraw Hill

 

Please note: these reading materials are only tentative and changes may occur. Final literature lists will be uploaded on CANVAS before the course begins. 

Last updated on 17-05-2021