Course objectives:
The aim of the course is to provide students with cases in business management from point of
view of essential knowledge in corporate finance about project and investment valuating,
mergers and acquisitions, estimating of capital costs, problematic of risk of investment and
portfolio.
Requirements on student
Compulsory attendance at seminars 25 %.
Seminar paper, seminar discussions, final test
Content
1. Time value of money
2. Real value of cash flows
3. Valuating methods
4. Mergers and acquisitions
5. Capital structure
6. Risk
3. Valuating methods
Net present value method (NPV) and its practical usage on an example of case study.
Advantages and disadvantages.
4. Valuating methods
Internal rate of return method (IRR) and its practical usage on an example of case study.
Advantages and disadvantages.
5. Valuating methods
Profitability index method (PI) and its practical usage on an example of case study.
Advantages and disadvantages.
6. Valuating methods
Payback period method (PBP) and its practical usage on an example of case study.
Advantages and disadvantages.
12. Risk
Magical triangle. Risk of simple investment. Risk as a part of economy. Risk versus
uncertainty. How to determine the probability. Expected rate of profit, variation coefficient.
13. Risk
Risk of portfolio of two assets. Specific and systematic risk. Diversification of risk.
Correlation coefficient and its use for investment valuation.