Syllabus for MBAC6060,Corporate Finance, Spring2011

Syllabus for MBAC6060,Corporate Finance, Spring2011

David M. Gross, Ph.D.

Description

This course will cover the concepts and skills needed to make sound financial decisions. Topics include financial statement analysis, time value of money, interest rate terminology and calculations, bond valuation and bond markets, stock valuation and stock markets, business cost of capital and capital structure, capital budgeting and financial forecasting. We also will cover terminology associated with personal financial management and decisions.

Learning Objectives

After this course you will know how a firm decides which business opportunities are profitable and which are not. You will know how corporations raise money to fund these profitable projects. You will know the difference between funding a project by selling a piece of the company (selling stocks) versus funding the project by borrowing the money (selling bonds). You will know the terminology associated with interest rates and payments and know how they are set. You will know the basic customs and terminology associated with stocks and bonds and as well as the trade-offs between risks and returns inherent in these securities. This leads to basic understanding of the value of stocks and bonds. Security valuation is important to both the investors buying the securities and the firm’s selling the securities. Finally, you’ll understand how firm’s manage the cost maintaining sufficient cash and inventory.

Contact Information

Office: Koelbel 402

Office Hours: M&W 1:30PM to 2:30PM and T&Th 10:00AM to 11:00AM

Office phone: 303-735-6181

E-mail:

Web Page:

Required Text

Corporate Finance, 9th edition, by Ross, Westerfield & Jaffe

Homework

Throughout the semester, I will assign homework problems from the end of the textbook chapters. Much of the material covered by the exams will be from these homework problems.

Questions will appear on the Connect website. You must use your login code toregister for the Connectweb site. See the course web site for instructions. These homework problems will be completed and graded on-line at this site and should be used as a tool to learn the materialto prepare for the exams.

Connect website

Assignments will be posted as the semester progresses but will not be due until either just before the midterm or just before the final.

I will add Additional Homeworkproblems to the course web site. These problems will not be collected or graded, but are fair game for the exams.

Exams

There will a midterm exam and a final exam. The majority of the material on the exams will be taken from the homework and lectures. The rest will come from the text and other readings. The final exam is cumulative.

Exam Schedule

Midterm TuesdayFebruary 22in the first hour and 30 minutes of class

Final ExamTuesday April 19in class (The final is cumulative)

Group Cases and Projects

The casesand projects will require you to build financial models using real and hypothetical market and accounting data to perform different types of analyses that we will cover throughout the semester. The specifics of the caseswill be related later in the term. The casesmay require you to print and submit short “hard copy” tables, charts and write-ups in class as well as submit your spread sheets electronically.

Evaluation

Online HW 5%

Cases & Projects20%

Midterm30%

Final Exam45%

These are the only factors that will be used to determine your course grade. There will be no extra credit. Per Leeds School policy, the maximum average course grade for an MBA Core course is 3.4.

Course Outline

Introduction (Chapter 1)
Accounting Review and Financial Ratio Analysis (Chapters 2 and 3)
Valuation, Time Value of Money and Discounting Cash Flows (Chapter 4)
Capital Budgeting, Project Evaluation and Financial Decisions (Chapters 5, 6 and 7)
Valuing Bondsand Stocks (Chapters 8 and9)
Historic and Expected Risk and ReturnMeasures Including a Look at Historic Data (Chapters 10 and 11)
Determinants of Risk and Market Efficiency (Chapters 13 and 14)
Long-TermFinancing, Capital Structure and Raising Capital (Chapters 15, 16, 17 and 20)
Dividend Policy (Chapter 19)
Additional Topics and Current Events (as time allows)

Web Sites

There are two web sites associated with this course:

The Course Website

This site can be reached from my faculty website:

As the semester progresses, I will use thecourse web site to post lecture slides, additional readings and links, homework assignments and answers, spreadsheets, information about the Excel projects and exam information

Connect Website

You will use the Connect site to complete chapter homework assignments. These assignments will be completed and be graded online at the Connect site. You must use your Connect login code to create account.

Disabilities

Students with disabilities who qualify for academic accommodations must provide a letter from Disability Services (DS) and discuss specific needs with the professor (in person or by e-mail), preferably during the first two weeks of class. DS determines accommodations based on documented disabilities (303-492-8671, Willard 322,

University Student Policies:

All University of Colorado and Leeds School of Business rules, policies, and procedures will be followed in the course (including those related to drop/add requirements and the grade of “IF”). Academic dishonesty can result in a failing grade for the course. University policies regarding academic and behavior issues should be reviewed at:

Religious Observance:

Campus policy regarding religious observances requires that faculty make every effort to reasonably and fairly deal with all students who, because of religious obligations, have conflicts with scheduled exams, assignments, or require attendance. Please contact your Instructor prior to any potential course conflict.

Student Honor Code:

The purpose of an Honor Code at the University of Colorado at Boulder is to secure an environment where academic integrity, and the resulting behavior, can flourish. The Honor Code recognizes the importance of honesty, trust, fairness, respect, and responsibility and wishes these principles to be a defining part of the CU-Boulder campus. The Honor Code allows all students to have responsibility for, and the ability to attain, appropriate recognition for their academic and personal achievements. Academic dishonesty can result in a failing grade for the course.

Students will be asked to include this pledge on exams: “On my honor, as a University of Colorado at Boulder student, I have neither given nor received unauthorized assistance on this work.”