Fundamentals of Corporate Finance

Introduction

Please note that this is a preliminary course description. The final version will be published in June 2026.

A corporation is a separate legal entity and can be viewed as a vehicle for making-, organizing-, and funding investment decisions. In a limited liability corporation, shareholders have delegated investment decisions to the board of directors and an administration (the Chief Executive Officer, Chief Financial Officer, etc.).  The course will establish a framework for how an administration ought to make investment decisions on behalf of shareholders.

Course content

1. Value and Capital Budgeting
   • Discounted Cash Flow Valuation
   • Net Present Value
   • Making Investment Decisions
2. Risk and Return
   • Returns
   • Measuring risk
   • The Capital Asset Pricing Model
   • Risk and Cost of Capital
3. Capital Structure
   • Introduction to Long Term Financing
   • Equity financing
   • Debt financing
   • Capital Structure and Corporate Value
   • Limits to the Use of Debt
4. Corporate Valuation
5. International Corporate Finance
   • The Multinational Firm and the International Monetary System
   • The Foreign Exchange Market – Triangular Arbitrage
   • The Foreign Exchange Market - Parity Relations
   • Forwards and futures
   • Currency options
   • Swaps
6. Leasing
7. Options