Cor­por­ate Fin­ance

Course content

This is an introductory course in finance focusing on corporate applications in the international environment. It covers the basic theories of interest rates, valuation of streams of cash flows, pricing of risk, and it draws practical implications for capital structure, project valuation, financing, and risk management.

More specifically, the course contains a basic introduction to topics such as:

• The main characteristics of corporations
• The relationship between accounting information and the information analysed in corporate finance
• Interest rates and the time value of money
• The valuation of bonds and stocks
• The investment decision
• The financing decision including capital structure theory and the cost of capital
• Payout policy
• Mergers and acquisitions
• International financial mangement and capital budgeting
• Financial and real options
• Risk management

Thereby, the course reflects the BSc IB program learning goals in the following way:

Practical Application of Theory
The course includes many exercises and cases illustrating the practical application of theory. In particular, this is achieved both through lectures (illustrating practical applications) and assigned readings from The Economist.

Relation to a Business or an Institutional Setting
Several aspects of different types of financial markets are examined including public versus privately owned companies and various types of providers of capital (investors).

Relation to International Business or Economics
The international perspective is taken in connection with many of the topics covered during the course especially including mergers and acquisitions, financial management and capital budgeting, and risk management. Several examples are looking at multinational firms.

Research Based Teaching
The curriculum includes articles that summarize several research papers and ties such research to the practical use of the theoretic methodologies introduced in the course. Furthermore, evidence from several empirical studies is discussed during the course.