Two - Year Master Degree in Economics

APPLIED CORPORATE FINANCE

APPLIED CORPORATE FINANCE

Academic year 2023/2024

Sommario del corso

• Course objectives
• Results of learning outcomes
• Program
• Course delivery
• Learning assessment methods
• Suggested readings and bibliography
• Teaching tools
• Course card

Course objectives

Understand the basic principles of Managerial Corporate Finance and apply this knowledge in practice. By the end of this course, participants should be able to make a business plan, understand and produce financial statements, and value complex corporate derivatives.

Results of learning outcomes

Understand the basic principles of Managerial Corporate Finance and apply this knowledge in practice. By the end of this course, participants should be able to make a business plan, understand and produce financial statements, and value complex corporate derivatives.

Knowledge and understanding: The students will understand financial statements, corporate derivatives, and financial planning.

Applying knowledge and understanding: The students will know how to write a business plan, value an executive option package, and work with real options. 

Making judgements: By making a business plan, the students will be able to accept or reject projects based on economic viability and firm cash policy. 

Communication skills: The students will be able to explain why certain projects are viable and why not, using the business plan evaluation techniques learned in the course.

Learning skills: The students will acquire a new methodology to investigate business plan, but also learn about more advanced topics in corporate finance, such as valuation fo startups, conflicts of interests, hostile take-over, and valuing complex corporate securities and real options. 

Program

Topics:

1. Financial Statement
   1. Statement of Cash Flows
   2. Income Statement
   3. Balance Sheet
2. Cost of Capital
   1. Cost of Equity
   2. CAPM
   3. Cost of Debt
   4. WACC
   5. Debt vs. Shareholders conflicts of interest
3. Project Evaluation
   1. ROE, ROCE, EVA, MVA
   2. NPV, IRR
   3. Payback, Discounted Payback
   4. Sunk vs. Opportunity Cost
   5. Business plan sensitivity analysis
4. Corporate Derivatives
   1. Option Pricing
   2. Convertible Debt
   3. Black Scholes
   4. Real Options
5. Special topics and Case Studies

Course delivery

In class: Students are required to attend all lectures and work in groups together to solve in-class exercises. 

Learning assessment methods

There is a final exam (100% of the grade) in which students should solve exercises. Students should take a laptop to the exam as spreadsheet software such as Excel or Google Sheets will be useful for solving the questions. The final exam is individual and communication is strictly not allowed.

The course material is self-contained and no need of external references are needed.

Optional additional reading:

• Damodaran, Applied Corporate Finance, 4th ed., Wiley
• Hawawini & Vaillet, Finance for Executives, S. Western

Courses that borrow this teaching

• CORPORATE FINANCE (SEM0064)
  Quantitative Finance and Insurance

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