Corporate Finance

Catalog description

The central organizing principle of this course is to familiarize the class with the basics of valuation. This first course in finance introduces the tools and methods employed in valuation of projects and corporate securities. Valuation involves the determination of (i) cash flows of the firm, project or financial assets and (ii) the discount rates that are used to compute the present values of the cash flows. Asset pricing models provide the underpinnings for the development of the discount rates. The material is synthesized in capital budgeting exercises which are cost-benefit analyses of capital project cash flows to evaluate whether they are value enhancing. Prereq: E.M.B.A. candidates only.