Corporate Finance

COURSE OBJECTIVE
Corporate Finance studies firms as economic decision makers. The goal of this course is to develop a framework that provides guidance for investment and financing decisions. This requires not only a fundamental understanding of most common corporate finance theories (Bridging Theory and Practice - Knowledge), but also a selection of sensible applications for them (Academic skills and Research Skills).
Our main decision criterion is based on value creation, which we will learn to quantify in a flexible valuation model. Practical applications
for the knowledge are widespread and not only of interest to managers, but part of a toolkit required by everyone who is dealing with financial markets (Bridging Theory and Practice - Application).

At the end of the course you are able to:
- contrast financing incentives provided by equity and debt financing;
- distinguish between implications derived from various capital structure theories and put them into perspective;
- extend theories to other decisions, like payout policy/risk management;
- construct and critically assess valuation models;
- understand how markets for corporate securities work;
- explain the most common corporate governance mechanisms.

COURSE CONTENT
This course offers an introduction for students with interests in financial markets or the intent to pursue a career in finance. We attempt to provide a sound mix between formal/quantitative analysis and qualitative discussion. From a modeling perspective, we extend methods learned in Finance I and II and put them into a corporate setting. When talking about value-driving factors, we see links to Economics and
Management of Organizations and Marketing. Overall, the content learned in this course enables students to understand corporate decisions/valuations by reducing complex problems to its key components.

TEACHING METHODS
Lectures and tutorials.

TYPE OF ASSESSMENT
Case studies/Assignments (group assessment)
Written Exam (individual assessment)