| Learning objectives |
To achieve the grade 12, students should meet the
following learning objectives with no or only minor mistakes or
errors: 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 grows 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 and Derivatives:
|
| 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 |
Winter |
| 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
The number of registered candidates for the make-up
examination/re-take examination may warrant that it most
appropriately be held as an oral examination. The programme office
will inform the students if the make-up examination/re-take
examination instead is held as an oral examination including a
second examiner or external
examiner.
|
|
| Course content, structure and pedagogical
approach |
|
Contents
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, and mergers and
acquisitions.
|
| Description of the teaching methods |
| The format of the course is based on lectures,
cases, and exercises. Problem sets will be posted on CBSCanvas a
week in advance. |
| Feedback during the teaching period |
| There will be weekly online quizzes on which the
students will receive feedback both online and in class. |
| Student workload |
| Preparation |
158 hours |
| Classes and Exercises |
44 hours |
| Exam |
4 hours |
|
| Expected literature |
- Jonathan Berk and Peter DeMarzo (2020): Corporate Finance,
Global Edition, 5th Edition, Pearson. ISBN13 978-1292-30428-1.
This ISBN13 number is for the version including Access Code
for MyLab Finance and E-text, which I recommend.
- Banz and Miller (1978): Prices for State-Contingent Claims:
some estimates and applications, provided on CBSCanvas.
- Teaching presentations and notes uploaded on CBSCanvas.
- Exercises and their solutions from
classes.
|
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