Health Care Managerial Finance I

Catalog description

The purpose of this course is to provide a framework for evaluating how firms should make investment and financing decisions to create value for their shareholders or stakeholders. For most of the course we will focus on profit-maximizing firms, although we will discuss whether and how the investment and financing decisions are different for nonprofit firms that are prevalent in the health care industry. Therefore, this is primarily a course on general corporate finance. Specifically, we will discuss why the net present value (NPV) of discounted cash flows is the best investment criterion; calculate NPVs; derive appropriate discount rates; estimate the value of bonds, stocks, and options; and determine the optimal amount a firm should borrow. In order to understand how firms make investment and financing decisions, we will also consider how financial markets function and how investors in those markets should make decisions.