This unit applies all aspects of finance theory to the general problem of valuing companies and other financial assets. This requires a synthesis of the fundamental concepts of present value, cost of capital, security valuation, asset pricing models, optimal capital structures, derivative pricing and some related accounting concepts. The unit aims to reach a level of practical application that allows students to understand both the theoretical frameworks and institutional conventions of real world corporate valuations. Basic valuation concepts from accounting are reconciled with the finance theory on which firm value ultimately stands. Students are asked to make extensive use of Excel or similar software in valuation exercises.
1x 3hr seminar per week
mid-semester exam (25%), assignment (25%), final exam (50%)