Introduction to Corporate Finance.ppt

Introduction to Corporate Finance Chapter One FIN 6301Financial Management Instructor: Mary Chaffin SOM 2.208 972-883-2646 chaf@ Office Hours: Monday 4:00-6:30 p.m. Wednesday 2:00-3:30 p.m. Corporate Finance  Ross, Westerfield and Jaffee, 7th Edition /~chaf Copies of the transparencies. Solutions to end of chapter problems. Old exams. /rwj Appendix D: Using a Financial Calculator. Review material and practice quizzes. Grading Exam I 30% or 15% Exam II 30% or 15% Final Exam 40% Assignments 15% Formula sheet allowed on exams - not quizzes. Notice of Policy on Cheating Other Resources Wall Street Journal Barron’s Financial Calculator The Four Basic Areas of Finance Corporate Finance Broadest field Specific to operations of a business Investments Interrelation on a smaller scale then money and capital markets Money and Capital Markets Workings of the financial system Broad flow of money International Finance Areas of Finance Financial Calculators HP 10B ($30) HP 17B II ($80) HP 12C ($70) HP 19B II ($100+) TI BA II + ($30) Financial Calculators HP 10B TI BA II+ Tips on using calculator: Set p/y=1 (This comes set at 12 on a new calculator) Clear registers before each use Set decimals to 4 places Solution Methods Numerical – using regular calculator without financial functions. Interest Tables - end of text. Financial Calculator – using five specific keys which correspond to the five most commonly used DCF variables: What is Corporate Finance? Corporate Finance addresses the following three questions: What long-term investments should the firm engage in? How can the firm raise the money for the required investments? How much short-term cash flow does a company need to pay its bills? Microsoft to Dole OutIts Cash Hoard In an extraordinary move to shower its cash hoard upon shareholders, Microsoft Corp. said it will make a one-time dividend payment this year of $32 billion and buy back up to $30 billion of the companys stock over the next four years. T