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2022/2023  KAN-CASCO1008U  Risk Management and Corporate Finance

English Title
Risk Management and Corporate Finance

Course information
Language English
Course ECTS 7.5 ECTS
Type Mandatory
Level Full Degree Master
Duration One Semester
Start time of the course Spring
Timetable Course schedule will be posted at calendar.cbs.dk
Study board
Study Board for MSc in Economics and Business Administration
Course coordinator
  • Katarina Warg - Department of Finance (FI)
Main academic disciplines
  • Finance
Teaching methods
  • Face-to-face teaching
Last updated on 30-11-2022

Relevant links
Learning objectives
The student should demonstrate clarity in the understanding and presentation of the following learning objectives:
  • Reflect on the implications of efficient markets and frictions on corporate financing and risk management.
  • Apply capital budgeting techniques and perform valuations.
  • Explain which factors are important for the optimal choice of capital structure, payout policy, and firm values.
  • Apply financial option techniques for the hedging and risk management of corporate risks.
  • Understand the assumptions and limitations of the various theories and models.
  • Put corporate finance and risk management insights from theories and models into context and perspective.
Course prerequisites
Admission req.
Bachelor level
Prerequisites for registering for the exam (activities during the teaching period)
Number of compulsory activities which must be approved (see section 13 of the Programme Regulations): 1
Compulsory home assignments
The student must get 1 out of 2 assignments approved in order to attend the
ordinary exam.

The assignments will be 2 cases which should be answered in groups of 4-5 students. The written solution to the case should not be more than 5 pages. Each group will receive written feedback on the solution that they provided.

Students will not have extra opportunities to get the required number of compulsory activities approved prior to the ordinary exam. If a student has not received approval of the required number of compulsory activities or has been ill, the student cannot participate in the ordinary exam.
If a student prior to the retake is still missing approval for the required number of compulsory activities and meets the pre-conditions set out in the program regulations, an extra assignment is possible.

The extra assignment is a 10 page home assignment that will cover the required number of compulsory activities. If approved, the student will be able to attend retake.
Examination
Risk Management and 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) One internal examiner
Exam period Spring
Aids Limited aids, see the list below:
The student is allowed to bring
  • USB key for uploading of notes, books and compendiums in a non-executable format (no applications, application fragments, IT tools etc.)
  • Any calculator
  • In Paper format: Books (including translation dictionaries), compendiums and notes
The student will have access to
  • Access to Canvas
  • Access to the personal drive (S-drive) on CBS´ network
  • 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.
Course content, structure and pedagogical approach

The course builds on the law of one price as the underlying theoretical principle and discusses how financial frictions affects decision-making. It is a fundamental finance course, which complements introductory bachelor level corporate finance courses.

 

The first part of the course provides the students with an understanding of corporate finance. The core elements covered in this part of the course are the valuation of investment projects, corporate finance polices, payout policy, and capital structure choice. The second part of the course investigates corporate risk management and covers financial options, real options, hedging of corporate risk, and international risk management.
Description of the teaching methods
The course contains the following elements:

• Research and theory based class lectures.
• Pre-recorded videos on selected topics.
• Class and home work exercises - preparing the student for the written exam.
• Student involvement through exercise classes and discussions.
Feedback during the teaching period
Students are encouraged to active participation at lectures and exercises.

Exercise classes will feature a large number of exercises preparing the student for the written exam. Students are expected to have worked with the exercises before
classes so that they can ask questions and participate in discussions during classes.

Students will receive written feedback on the mandatory cases.

Students can use office hours for individual feedback.
Student workload
Lectures 100 hours
Exercises 70 hours
Exam 36 hours
Expected literature

“Corporate Finance” by Jonathan Berk and Peter DeMarzo, 5th edition, Pearson

(We will use the newest edition of the book).


Selected academic articles.
Last updated on 30-11-2022