SAIS 380.760
Corporate Finance

Outline

Course Announcements

 Prof Gordon Bodnar
Fall 2008

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Course notes and materials are available by clicking on the lecture titles and problem set and case names or proceeding directly to the download page.  Access is restricted. Lecture notes and handouts are in Adobe *.PDF format and require an Acrobat reader to access. If you do not have an Acrobat reader, you may download one from Adobe's home page.

The readings can be found in the textbook by Berk and DeMarzo (BD) or on reserve (R) or on the web (W) using the links provided.

Date

Lect #

Title

Readings

Assignments

9/2

1

The Financial System and Financial Statement Basics

EXTRA: FINSIMS – Ratios

EXTRA: Article on proposed new financial statements - CFO.com

    Problem Set #1  - Due 9/16 classtime (email to Corpfin@jhu.edu)

9/9

2

Time Value of Money - the mathematics of finance

BD: Chapters 3, 4 and 5
W: Understanding The Time Value Of Money – Investopedia 
W: Calculating The Present And Future Value Of Annuities – Investopedia

EXTRA: FINSIMS – TVM 

    Problem Set #2   - Due FRIDAY 9/19 12:00pm (email to Corpfin@jhu.edu)

9/9 - 9/16   Financial Calculator Sessions - T.A. Sessions during this period

W: TI BAII PLUS on-line Tutorial (at http://www.tvmcalcs.com/baiiplus.htm)
W: TI BA II PLUS PROFESSIONAL on-line Tutorial (at http://www.tvmcalcs.com/baiiplus_professional.htm)

If you decide to try to use an other calculator, i.e., HP 10BII HP 12C, tutorials can be found for these and other possible financial calculators at  http://www.tvmcalcs.com/

 9/16

 3

Valuing Bonds and Stocks and Using NPV to Make Investment Decisions

BD: Chapters 8, 9 and 6
W: Stock and Bond Basics - at investopedia.com
W: Digging Into The Dividend Discount Model  – at Investopedia.com

EXTRA: FINSIMS – Bonds  FINSIMS – Stocks

   Problem Set #3  - Due FRIDAY 9/26 12:00pm (email to Corpfin@jhu.edu)

9/23

4

Risk and Return and Asset Pricing Models

DL: Statistics Review - classnote
BD: Chapters 10, 11 and 12

Optional reading: BD Chapter 13

EXTRA: FINSIMS – Cost of Capital        FINSIMS – Portfolio Theory 

    Problem Set #4  -  Due FRIDAY 10/3 12:00pm (email to Corpfin@jhu.edu)

9/30

5

Capital Budgeting

BD Chapter 7 
EXTRA: FINSIMS – Cash Flows    

        Homework Case #1: Toll House Cookie Case - Due FRIDAY 10/10 12:00pm (email to Corpfin@jhu.edu)

10/7

6

Corporate Financing 

BD: 23 and 24
DL: Roundtable on Market Efficiency (on download page) 
DL: Passive Investment Strategies and Efficient Markets (on download page)
W: Types of Stocks - fool.com (on download page)
W: Types of Bonds - from finpipe.com    
W: IPO Basics - investopedia.com (on download page)      

TBD

REVIEW SESSION                                                            

 Sample Exams 

10/14

October 14 Midterm Exam (lects 1-6)  -  in class

10/21

7

Capital Structure

BD: Chapters 14, 15 and 16

 Problem Set #5 -  Due WED 10/29 3/26 12:00pm (email to Corpfin@jhu.edu)

10/28

8

Payout Policy and Leasing

BD: Chapter 17 and 25
W: Dividends: - from invest-faq 
W: A Breakdown of Stock Buybacks  - from Investopedia
W: Basics of Leasing - from Equipment Leasing and Finance Association 

FOR FUN: Stock Splits, Dividends and Repurchases - from onlineinvestor.com
                W: Example of Leasing decision - Bodnar example

 Problem Set #6  - Due WED 11/5 12:00pm (email to Corpfin@jhu.edu)

11/4

9

Advanced Valuation with Capital Structure

BD: Chapters 18 and 19 

  Homework Case #2 - Target Valuation  - Due FRIDAY 11/14 12:00pm (email to Corpfin@jhu.edu)

11/11

10

Options and Option Pricing

BD: Chapters 20, 21 and 22
W: Options –  from Investopedia
W: Options and Option Pricing  -from riskglossary.com

EXTRA: W: Options Basics - Interactive Web program from the Options Industry Council - Learning Center
EXTRA: FINSIMS – Options
EXTRA: Option Pricing Calculator - Option Industry Council

Extra Reading:   DL: The Real Power of Real Options – from Corporate Finance

  Problem Set #7 – Due FRIDAY 11/21 12:00pm (email to Corpfin@jhu.edu)

11/18

11

Risk Management 

BD: Chapter 30
W: Insurance – Wikipedia
W: Definition of a Futures Contract  - riskglossary.com
W: What is an Interest Rate Swap? - from  Earthlink site
DL: Examples of Interest Rate and Currency Swap Pricing - classnote
W: Beginner’s Guide to Hedging  - Investopedia 

 Problem Set #8  - Due  FRIDAY 12/5 12:00pm (email to Corpfin@jhu.edu)

12/2

12

BD: Chapters 28 and 29
W: What is Corporate Governance – an entire website with lots of info  (at http://www.encycogov.com/WhatIsGorpGov.asp)
W: Corporate governance: A basic foundation for the global economy  (at http://www.oecdobserver.org/news/fullstory.php/aid/317)
W: Summary of Sarbanes-Oxley Act of 2002 (at http://www.aicpa.org/info/sarbanes_oxley_summary.htm)
W: Sarbanes Oxley after 5 years – Economist

TBD

Review for Final Exam  TBD

Sample Exams

12/16

  December 16 Final Exam  9:00am - 12:00pm

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