The course provides students with the fundamental concepts of corporate finance and helps them understand the rationale of non-financial firms’ financial decisions in a context of uncertainty. The course focuses on investment decisions, capital structure decisions and cost of capital estimation.
Curriculum
Fruizione: 21201493 FINANZA AZIENDALE in Economia L-33 (docente da definire)
teacher profile teaching materials
1. Business forms, separation between ownership and control, stock markets
2. Annual reports, balance sheet analysis and financial decision making
3. Net present value, the separation between consumption and investment, the law of one price, arbitrage
4. Time value of money, interest rates, cost of capital
5. Capital budgeting: cash flow estimation, DCF method, IRR, and alternative methods for valuing investments
6. Methods for estimating the price of stocks
7. Risk measures
8. Mean-variance models, portfolio diversification and the risk-return relationship
9. Capital asset pricing model (CAPM), beta and cost of capital
10. Capital structure and firm value in perfect markets (Modigliani and Miller theorems)
11. Debt and taxes
12. Bankruptcy costs, agency costs of debt and information asymmetries
13. Capital structure of Italian firms and international comparison
14. Weighted average cost of capital and adjusted present value (APV)
15. Capital budgeting with differrent capital structure policies
Programme
The most important topics of the course are as follows:1. Business forms, separation between ownership and control, stock markets
2. Annual reports, balance sheet analysis and financial decision making
3. Net present value, the separation between consumption and investment, the law of one price, arbitrage
4. Time value of money, interest rates, cost of capital
5. Capital budgeting: cash flow estimation, DCF method, IRR, and alternative methods for valuing investments
6. Methods for estimating the price of stocks
7. Risk measures
8. Mean-variance models, portfolio diversification and the risk-return relationship
9. Capital asset pricing model (CAPM), beta and cost of capital
10. Capital structure and firm value in perfect markets (Modigliani and Miller theorems)
11. Debt and taxes
12. Bankruptcy costs, agency costs of debt and information asymmetries
13. Capital structure of Italian firms and international comparison
14. Weighted average cost of capital and adjusted present value (APV)
15. Capital budgeting with differrent capital structure policies
Core Documentation
− Berk, J., DeMarzo, P., 2018. Finanza aziendale 1 - Fondamenti, Pearson, 4th edition, Chapters 1, 2, 3 (with Appendix), 4 (with Appendix), 5 (excluding Appendix), 7 (with Appendix), 8 (excluding section 8.5), 9 (with Appendix), 10, 11 (excluding Appendix), 12 (excluding section 12.4, with Appendix), 14, 15, 16, 18 (excluding section 18.4, with Appendix).Reference Bibliography
textbookType of delivery of the course
recorded lessons and exercisesAttendance
attendance recommendedType of evaluation
As a result of COVID-19 which has made the submission of a written exam impossible, the final test has been structured as an on-line test lasting 30 minutes and composed of 20 multiple choice questions + oral exam