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This course cannot be combined with the course Corporate Finance (LUISS).
Topics:
- Financial statements, time value of money
- Corporate governance, DCF (discounted cashflow) and loans
- Bonds and equity
- Capital budgeting
- Market efficiency, risk, CAPM model and SML
- Cost of capital and capital structure
- Risk management and options
- Loose ends and rehearsal
Academic skills
This course focuses on the following academic skills:
- Analytical skills:
- Being able to solve problems (identifying the problem, devising a path towards the solution, follow this path, verify the outcome) for more complex assignments.
- Being able to identify, interpret and critically evaluate the main line of reasoning, for more complex problems.
- Being able to evaluate evidence in text and presentations for more complex problems.
Format
There will be plenary lectures and plenary review sessions.
The main focus of the lectures is on knowledge transfer and creating an understanding for the subject.
The review sessions, assignments and typical exam questions will be worked out together so that you are well prepared for the upcoming weekly quiz and the final exam. The main focus of the review sessions is to get you to work, to work through exercises together, and to have more time for your questions.
Assessment method
The final course grade will be the weighted average of your best three weekly quiz grades (together 15% weight) and a final exam (85% weight). There will be six weekly quizzes. The best three grades of your weekly quizzes will count for 5% of your course grade (together 15%). The weekly quizzes will consist of calculus.
Quizzes
The weekly quizzes will be online assignments on 'Connect'. This is an online learning and testing environment of the publisher of the textbook, McGraw-Hill. To access Connect you need the unique login code from your textbook. It is your responsibility to have access to the online environment on which the weekly quizz will be offered and that you have a reliable and working internet connection for the weekly quiz. You do not need to pass the weekly quizzes in order to pass the whole course.
To minimize cheating all questions in the weekly exercises will be unique. Each student will get a random draw out of a pool of questions about the same topic and all calculus questions will be algorithmic. Moreover the time frame in which the weekly quiz can be answered will be limited to reduce the opportunities for cooperation.
There is no opportunity to retake individual weekly quizzes or all weekly quizzes altogether. As only the best three quizzes are taken into account for the course grade you can miss some weekly quizzes without endangering your course grade. If you cannot take a weekly quiz or two, for example because of sickness, then there are still enough other weekly quizzes left to get a good grade. You can miss up to three weekly quizzes, provided you do the other three. If you only hand in two weekly quizzes, then the grade of the two you handed in will be counted with 5% each plus one (missing) quiz with grade 1 for 5%. If you hand in only one weekly quiz, then two missing quizzes (5% each) will be counted with grade 1. If you hand in no weekly quiz, 15% of your course grade will be a 1.
Make sure that you hand in 3 weekly quizzes as early as possible. It is your responsibility if you get sick late in the course and you speculated on handing in only the last three weekly assignments. There will be no retake opportunity for the weekly quizzes! If you cannot attend an exam, e.g., because you are sick, then you need to contact the exam commission
Final exam
The final exam is a closed-book exam which consists of multiple choice questions and open calculus questions. The final exam will cover all topics of the course, including the topics of the weekly quizzes. This is not an online exam and you are not allowed to bring any books or notes to the final exam. Only non-programmable calculators are allowed. A sheet with the most important formulas will also be provided (and posted in advance of the exam on BB). The exam will consist of 35 multiple choice and a multiple open questions.
Effort requirements
There will be no effort requirement for this course, so following U.S.E. policy, a 4 means you are eligible for a full retake and a 5 means you can choose between a full retake or a supplementary retake.
Course materials
Please purchase the following course textbook before the first lecture:
Hillier, Clacher, Ross, Westerfield, Jordan (2014): Fundamentals of Corporate Finance, 2nd European Edition, McGraw-Hill, ISBN-9780077164263
Make sure that you buy the European edition of the textbook and not the American one (simply check the ISBN number to be sure). And make sure you buy the book at ECU’92 for obtaining the connect-code (essential for the course).
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