Corporate Finance

2019-2020

Course Objective

Corporate Finance studies firms as economic decision makers. The goal of
this course is to develop a framework that provides guidance for
investment and financing decisions. This requires not only a fundamental
understanding of most common corporate finance theories (Bridging Theory
and Practice - Knowledge), but also a selection of sensible applications
for them (Academic skills and Research Skills).
Our main decision criterion is based on value creation, which we will
learn to quantify in a flexible valuation model. Practical applications
for the knowledge are widespread and not only of interest to managers,
but part of a toolkit required by everyone who is dealing with financial
markets (Bridging Theory and Practice - Application).

At the end of the course you are able to:
- contrast financing incentives provided by equity and debt financing;
- distinguish between implications derived from various capital
structure theories and put them into perspective;
- extend theories to other decisions, like payout policy/risk
management;
- construct and critically assess valuation models;
- understand how markets for corporate securities work;
- explain the most common corporate governance mechanisms.

Course Content

This course offers an introduction for students with interests in
financial markets or the intent to pursue a career in finance. We
attempt to provide a sound mix between formal/quantitative analysis and
qualitative discussion. From a modeling perspective, we extend methods
learned in Finance I and II and put them into a corporate setting. When
talking about value-driving factors, we see links to Economics and
Management of Organizations and Marketing. Overall, the content learned
in this course enables students to understand corporate
decisions/valuations by reducing complex problems to its key components.

Teaching Methods

Lectures.
Tutorials (60 students).
Tutorials (30 students).

Method of Assessment

Case studies/Assignments (group assessment)
Written Exam (individual assessment)

Literature

J. Berk en P. DeMarzo (2017), Corporate Finance, Pearson, 4de Global
Edition.

Additional Information

Completing this course (or alternatively a corporate finance course in
the other BSc tracks) is a prerequisite for the MSc Finance and a
recommended course for the MSc Business Administration - specialization
Financial Management.

Recommended background knowledge

Finance I and II.
Basic Stata skills (including use of do-files)

General Information

Course Code E_EBE2_CF
Credits 6 EC
Period P5
Course Level 300
Language of Tuition English
Faculty School of Business and Economics
Course Coordinator dr. J.A.F. Schnitzler
Examiner dr. J.A.F. Schnitzler
Teaching Staff

Practical Information

You need to register for this course yourself

Last-minute registration is available for this course.

Teaching Methods Seminar, Instruction course, Lecture
Target audiences

This course is also available as: