School of Management, Unit Catalogue 2006/07

MN20211 Advanced corporate finance

Credits: 6

Level: Intermediate

Semester: 2

Assessment: EX100

Requisites:

Before taking this unit you must take MN10311

Aims: This unit develops, and analyses in much greater depth, the material from the first year Company Finance course MN10311. In addition to the theoretical issues, students will gain an understanding of the practical issues involved in a firm&©s investment and financing decisions. Students will analyse issues relating to new investment appraisal (particularly decision trees, risk analysis, and real options), cost of capital (CAPM versus APT), and the effect of capital structure on firm value (particularly the effects of managerial incentives and signalling on a firm&©s financing decisions). The course will then proceed to consider convertible debt, and optimal risk management policies.
Learning Outcomes:
By the end of this unit, the student should be able to:
* Perform numerical analyses of investment appraisal and capital structure decisions.
* Discuss the results of the aforementioned analyses.
* Write management-style reports recommending optimal investment and financing policies, considering all of the issues involved.
Skills:

* Intellectual Skills (T/F/A)
* Professional Practical Skills (T/F/A)
* Transferable/ Key Skills (T/F/A)
Content:

* New Investment Appraisal (including decision trees/risk analysis/real options).
* Cost of Capital, Capital Structure, and Firm Value.
* Optimum Capital Structure, with regard to tax, agency costs, and signalling.
* Convertible debt.
* Risk Management.
* Dividend Policy.
* Takeovers.

University | Catalogues for 2006/07