GRA 8150 Corporate Finance
APPLIES TO ACADEMIC YEAR 2012/2013
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GRA 8150 Corporate Finance Responsible for the course Øyvind Norli Department Department of Financial Economics Term According to study plan ECTS Credits 3 Language of instruction English Introduction The objective of the course is to present the main financial concepts and techniques that managers need in order to understand the requirements of investors, carry out a financial analysis, determine the economic value of a project and select the most appropriate financing instruments. We propose an integrated approach to corporate finance stressing the interdependence between operations and financial management. Learning outcome The objective of the course is to familiarise the participants with how organisations should make financial decisions. For a firm, these decisions are: · The real asset decision: · How should the firm invest in real productive assets? · How should the firm assess risk? · The financing decision: · How should the firm finance its real assets? Typically, these decisions are strategic in nature since they are frequently costly to reverse and have significant, long-term and risk consequences. Learning outcome Acquired knowledge: · Methods for evaluating investment projects · Handling risk in project analysis · Determining a company and project cost of capital · Determination of the appropriate firm capital structure · Understanding options · Understand key challenges of Mergers and acquisitions Acquired skills: · Choosing between good and bad investment projects · Adjusting project returns for risk · Estimating the economics consequences of mergers and acquisitions Reflection: The participants should be able to evaluate the trade-off between risk and return in making financial decisions. Prerequisites Granted admission to the Executive Master of Management in Energy Management programme. Compulsory reading Books: Hillier, David ... [et al.]. 2013. Corporate finance. 2nd European Edition. McGraw-Hill Other: Cases: Will be distributed. Recommended reading Course outline Understanding financial statements: Balance sheet, income statement, cash flow statement Valuation of future cash flows: The time value of money Discounted cash flow Valuation of bonds and stocks Economic project analysis: Investment criteria Project cash flows Project analysis and evaluation Risk and return: The historical record Systematic and unsystematic risk The Capital Asset Pricing Model (CAPM) Options and corporate finance Financial policy Cost of capital Raising capital Financing the firm: Debt or equity? Dividend policy Computer-based tools It's Learning Learning process and workload 1 ECTS credit corresponds to a workload of 26-30 hours. Attendance to all sessions in the course is compulsory. If you have to miss part(s) of the course you must ask in advance for leave of absence. More than 20% absence in a course will require retaking the entire course. It's the student's own responsibility to obtain any information provided in class that is not included on the course homepage/ It's learning or other course materials
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