Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth EditionESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

This book is an introduction to corporate finance and the profession of financial management.

This material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important. To survive and prosper, a company must satisfy its customers. It must also produce and sell products and services at a profit. In order to produce, it needs many assets—plant, equipment, offices, computers, technology, and so on. The company has to decide (1) which assets to buy and (2) how to pay for them. The financial manager plays a key role in both these decisions. The investment decision, that is, the decision to invest in assets like plant, equipment, and know-how, is in large part a responsibility of the financial manager. So is the financing decision, the choice of how to pay for such investments. We start by explaining how businesses are organized. We then provide a brief introduction to the role of the financial manager and show you why corporate managers need a sophisticated understanding of financial markets. Next we turn to the goals of the firm and ask what makes for a good financial decision. Is the firm’s aim to maximize profits? To avoid bankruptcy? To be a good citizen? We consider some conflicts of interest that arise in large organizations and review some mechanisms that align the interests of the firm’s managers with the interests of its owners. Finally, we provide an overview of what is to come.

This material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important. To survive and prosper, a company must satisfy its customers. It must also produce and sell products and services at a profit. In order to produce, it needs many assets—plant, equipment, offices, computers, technology, and so on. The company has to decide (1) which assets to buy and (2) how to pay for them. The financial manager plays a key role in both these decisions. The investment decision, that is, the decision to invest in assets like plant, equipment, and know-how, is in large part a responsibility of the financial manager. So is the financing decision, the choice of how to pay for such investments. We start by explaining how businesses are organized. We then provide a brief introduction to the role of the financial manager and show you why corporate managers need a sophisticated understanding of financial markets. Next we turn to the goals of the firm and ask what makes for a good financial decision. Is the firm’s aim to maximize profits? To avoid bankruptcy? To be a good citizen? We consider some conflicts of interest that arise in large organizations and review some mechanisms that align the interests of the firm’s managers with the interests of its owners. Finally, we provide an overview of what is to come.

Prepared by Matthew Will, University of Indianapolis, the Study Guide contains a thorough list of activities for the student, including an introduction to the chapter, sources of business information, key concepts and terms, sample problems with solutions, integrated PowerPoint slides, and related web links.

xx, 859 p. : 29 cm Includes bibliographical references and index

Fundamentals of Corporate Finance, by Brealey, Myers and Marcus, provides students with a solid framework of theory and application to use well after they complete the course. This author team is known for their outstanding research, teaching efforts, and world-renowned finance textbooks, so it's no surprise that they provide clear exposition of difficult material without sacrificing up-to-date, technically correct treatments. And with the Eighth Edition, McGraw-Hill's adaptive learning component, LearnSmart, provides assignable modules that help students master chapter core concepts and come to class more prepared. In addition, resources within Connect help students solve financial problems and apply what they've learned. Brealey's personable writing style and world-leading content combine with a complete digital solution to help students achieve higher outcomes in the course. Connect is the only integrated learning system that empowers students by continuously adapting to deliver precisely what they need, when they need it, and how they need it, so that your class time is more engaging and effective

Fundamentals of Corporate Finance......Page 1 SECTION 1......Page 12 The Firm and the Financial Manager 3......Page 14 Organizing a Business......Page 15 The Role of the Financial Manager......Page 18 Financial Institutions and Markets......Page 21 Who Is the Financial Manager?......Page 24 Goals of the Corporation......Page 28 Summary......Page 35 The Time Value of Money......Page 44 Future Values and Compound Interest......Page 45 Present Values......Page 49 Multiple Cash Flows......Page 57 Level Cash Flows: Perpetuities and Annuities......Page 61 Inflation and the Time Value of Money......Page 72 Effective Annual Interest Rates......Page 78 Summary......Page 80 Financial Planning......Page 92 What Is Financial Planning?......Page 93 Financial Planning Models......Page 97 Planners Beware......Page 104 External Financing and Growth......Page 107 Summary......Page 111 APPENDIX A......Page 120 Accounting and Finance......Page 122 The Balance Sheet......Page 123 The Income Statement......Page 128 The Statement of Cash Flows......Page 130 Accounting for Differences......Page 132 Taxes......Page 134 Summary......Page 137 Financial Statement Analysis......Page 144 Financial Ratios......Page 145 The Du Pont System......Page 156 Using Financial Ratios......Page 158 Measuring Company Performance......Page 161 The Role of Financial Ratios......Page 162 Summary......Page 164 SECTION 2......Page 174 Working Capital Management and Short-Term Planning......Page 176 Working Capital......Page 178 Links between Long-Term and Short-Term Financing......Page 183 Tracing Changes in Cash and Working Capital......Page 186 Cash Budgeting......Page 188 A Short-Term Financing Plan......Page 191 Sources of Short-Term Financing......Page 196 The Cost of Bank Loans......Page 198 Summary......Page 201 Cash and Inventory Management......Page 212 Cash Collection, Disbursement, and Float......Page 213 Managing Float......Page 216 Inventories and Cash Balances......Page 222 Summary......Page 230 Credit Management and Collection......Page 238 Terms of Sale......Page 240 Credit Agreements......Page 242 Credit Analysis......Page 243 The Credit Decision......Page 247 Collection Policy......Page 250 Bankruptcy......Page 251 Summary......Page 255 SECTION 3......Page 264 Valuing Bonds......Page 266 Bond Characteristics......Page 267 Bond Prices and Yields......Page 270 Summary......Page 284 Valuing Stocks......Page 290 Stocks and the Stock Market......Page 291 Book Values, Liquidation Values, and Market Values......Page 294 Valuing Common Stocks......Page 298 Simplifying the Dividend Discount Model......Page 302 Growth Stocks and Income Stocks......Page 307 Summary......Page 312 Introduction to Risk, Return, and the Opportunity Cost of Capital......Page 322 Rates of Return: A Review......Page 323 Seventy-Three Years of Capital Market History......Page 324 Measuring Risk......Page 330 Risk and Diversification......Page 335 Thinking about Risk......Page 342 Summary......Page 345 SECTION 4......Page 350 Net Present Value and Other Investment Criteria......Page 352 Net Present Value......Page 354 Other Investment Criteria......Page 360 Investment Criteria When Projects Interact......Page 367 Capital Rationing......Page 376 Summary......Page 378 Using Discounted Cash-Flow Analysis to Make Investment Decisions......Page 388 Discount Cash Flows, Not Profits......Page 390 Discount Incremental Cash Flows......Page 392 Discount Nominal Cash Flows by the Nominal Cost of Capital......Page 396 Separate Investment and Financing Decisions......Page 397 Calculating Cash Flow......Page 398 Example: Blooper Industries......Page 401 Summary......Page 408 Risk, Return, and Capital Budgeting......Page 418 Measuring Market Risk......Page 419 Risk and Return......Page 425 Capital Budgeting and Project Risk......Page 433 Summary......Page 436 The Cost of Capital......Page 446 Geothermal’s Cost of Capital......Page 447 Calculating the Weighted-Average Cost of Capital......Page 449 Measuring Capital Structure......Page 457 Calculating Required Rates of Return......Page 458 Big Oil’s Weighted-Average Cost of Capital......Page 461 Interpreting the Weighted-Average Cost of Capital......Page 462 Summary......Page 465 SECTION 5......Page 474 Project Analysis......Page 476 How Firms Organize the Investment Process......Page 477 Some “What-If ” Questions......Page 480 Break-Even Analysis......Page 484 Flexibility in Capital Budgeting......Page 492 Summary......Page 496 An Overview of Corporate Financing......Page 504 Common Stock......Page 505 Preferred Stock......Page 510 Corporate Debt......Page 511 Convertible Securities......Page 518 Patterns of Corporate Financing......Page 519 Summary......Page 522 How Corporations Issue Securities......Page 528 Venture Capital......Page 530 The Initial Public Offering......Page 531 The Underwriters......Page 537 General Cash Offers by Public Companies......Page 539 The Private Placement......Page 542 Summary......Page 543 Appendix: Hotch Pot’s New Issue Prospectus......Page 550 APPENDIX B......Page 556 Leasing......Page 558 Operating Leases......Page 559 Financial Leases......Page 560 Accounting and Leasing......Page 561 Taxes, the IRS, and Leases......Page 563 The Cash Flows from Leasing......Page 564 Lease or Buy?......Page 566 Leverage and Capital Structure......Page 570 The Effect of Financial Leverage......Page 571 SECTION 6......Page 576 Mergers, Acquisitions, and Corporate Control......Page 578 22.1 The Market for Corporate Control......Page 580 22.2 Sensible Motives for Mergers......Page 583 22.3 Dubious Reasons for Mergers......Page 586 22.4 Evaluating Mergers......Page 588 22.5 Merger Tactics......Page 593 22.6 Leveraged Buyouts......Page 596 22.7 Mergers and the Economy......Page 599 22.8 Summary......Page 601 International Financial Management......Page 608 23.1 Foreign Exchange Markets......Page 609 23.2 Some Basic Relationships......Page 613 23.3 Hedging Exchange Rate Risk......Page 623 23.4 International Capital Budgeting......Page 624 23.5 Summary......Page 628 APPENDIX C......Page 636 Glossary......Page 646

xx, 828 p. : 29 cm Includes bibliographical references and index

Selected material from FUNDAMENTALS OF CORPORATE FINANCE, Third Edition with additional material from:FUNDAMENTALS OF CORPORATE FINANCE, Alternate Fifth Edition ESSENTIALS OF CORPORATE FINANCE, Second EditionThis material is an introduction to corporate finance. We will discuss the various responsibilities of the corporation’s financial managers and show you how to tackle many of the problems that these managers are expected to solve. We begin with a discussion of the corporation, the financial decisions it needs to make, and why they are important.

A text for a first course in corporate finance, concentrating on how companies invest in real assets and how they raise the money to pay for these investments, for students with little or no background in business or finance. After background material, Parts II-V cover valuation, cost of capital, financing, and capital structure and dividend policy. Parts VI and VII look at financial planning and short-term financial decisions, and Part VIII covers special topics such as mergers and risk management. Pedagogical features include self-test questions and worked answers, chapter problems, mini-cases, calculator exercises, and readings on finance in practice. Contains color photos and color design elements. Annotation copyrighted by Book News, Inc., Portland, OR

Revised edition of Fundamentals of corporate finance, [2018]

xxxi, 728 pages : 29 cm Revised edition of Fundamentals of corporate finance, [2018] Includes bibliographical references and index

An introduction to corporate finance that focuses on how companies invest in real assets, how they raise the money to pay for the investments, and how those assets ultimately affect the value of the firm. The new edition provides a broad overview of the financial landscape. It also gives students a framework for systematically thinking about most of the important financial problems that both firms and individuals are likely to confront.

This text balances core coverage of the fundamental topics in corporate finance with an emphasis on modern business decision-making. The key principles and mechanics of the time value of money - a central concept - are carefully detailed and illustrated.

Brealey, Fundamentals of Corporate Finance, 10e, is an introduction to corporate finance and focuses on how companies invest in real assets, how they raise the money to pay for the investments, and how those assets ultimately affect the value of the firm. It also provides a broad overview of the financial landscape. The book offers a framework for systematically thinking about most of the important financial problems that both firms and individuals are likely to confront.Fundamentals is organized around the key concepts of modern finance. These concepts, properly explained, simplify the subject. They are also practical. The tools of financial management are easier to grasp and use effectively when presented in a consistent conceptual framework. This text provides that framework.

Fundamentals of Corporate Finance, by Richard A. Brealey, Stewart C. Myers and Alan J. Marcus, has been applauded for its modern approach and interesting examples. Professors praise the authors' well-organized and thoughtful writing style and their clear exposition of what many students consider difficult material. The authors accomplish this without sacrificing an up-to-date, technically correct treatment of core topic areas. Since this author team is known for their outstanding research, teaching efforts, and market-leading finance textbooks, it's no surprise that they have created an innovative, and market-driven revision that is more student friendly than ever. Every chapter has been reviewed and revised to reflect the current environment in corporate finance.

This text balances core coverage of the fundamental topics in corporate finance with an emphasis on modern business decision-making. The key principles and mechanics of the time value of money - a central concept - are carefully detailed and illustrated.

Brealey, Fundamentals of Corporate Finance , 11e, is an introduction to corporate finance focusing on how companies invest in real assets, how they raise the money to pay for the investments, and how those assets ultimately affect the firm's value. It also provides a broad overview of the financial landscape. The book offers a framework for systematically thinking about most of the important financial problems that both firms and individuals are likely to confront: financial management is important, interesting, and challenging. Fundamentals focuses on setting out the basic principles of financial management and applying them to the main decisions faced by the financial manager. The text is also organized around the key concepts of modern finance. These concepts, properly explained, simplify the subject. They are also practical. Financial management tools are easier to grasp and use effectively when presented in a consistent conceptual framework.

A text for a first course in corporate finance, concentrating on how companies invest in real assets and how they raise the money to pay for these investments, for students with little or no background in business or finance. After background material, Parts II-V cover valuation, cost of capital, financing, and capital structure and dividend policy. Parts VI and VII look at financial planning and short-term financial decisions, and Part VIII covers special topics such as mergers and risk management. Pedagogical features include self-test questions and worked answers, chapter problems, mini-cases, calculator exercises, and readings on finance in practice. Contains color photos and color design elements. Annotation copyrighted by Book News, Inc., Portland, OR

本书是一本经典的公司理财入门教材,旨在介绍公司理财的理论及实务知识,集中讨论了公司如何进行实物资产投资及怎样筹集所需资金.作者以价值最大化为目标,立足于金融市场;以风险与收益权衡为核心,以财务决策框架为主线,构造结构体系.主要涉及价值,风险,筹资,负债政策与分配政策,财务分析与财务计划等内容

ISBN: 9781260566093 is an International Student Edition of Fundamentals of Corporate Finance 10th Edition by Richard A Brealey, Stewart C Myers and Alan J. Marcus This ISBN 9781260566093 is Textbook only. It will not come with online access code. Online Access code (if required by your instructor ) sold separately at other ISBN The content of of this title on all formats are the same. Brealey, Fundamentals of Corporate Finance, 10e, is an introduction to corporate finance and focuses on how companies invest in real assets, how they raise the money to pay for the investments, and how those assets ultimately affect the value of the firm. It also provides a broad overview of the financial landscape. The book offers a framework for systematically thinking about most of the important financial problems that both firms and individuals are likely to confront. Fundamentals is organized around the key concepts of modern finance. These concepts, properly explained, simplify the subject. They are also practical. The tools of financial management are easier to grasp and use effectively when presented in a consistent conceptual framework. This text provides that framework.

3ee841f2-d0c1-4c4f-8971-169e1d58e270.pdf Est time: 01–05 Financial Statements a. Cash and marketable securities b. Accounts receivable c. Inventories d. Total current assets e. Net fixed assets f. Debt due for repayment g. Accounts payable h. Total current liabilities i. Long-term debt j. Equity Est time: 01–05 Balance Sheet Balance Sheet a. If the firm paid income taxes of $2,000, and the average tax rate was 20%, then taxable income must have been: $2,000/0.20 = $10,000. b. c. Est time: 06–10 Income Statement Est time: 01–05 Financial Statements Shareholders’ equity = total assets  total liabilities Shareholders’ equity = total assets  total liabilities Net working capital = current assets  current liabilities h. Current liabilities increased by $10. Therefore, current liabilities other than accounts payable must have increased by $45. Financial statement analysis Est time: 11–15 Financial Statement Analysis Est time: 11–15 Financial Statements a. Book value equals the $200,000 the founder of the firm has contributed in tangible assets. b. Market value equals the value of his patent plus the value of the production plant: $50,000,000 + $200,000 = $50,200,000. c. Book value per share = $200,000/2 million shares = $0.10 d. Price per share = $50.2 million/2 million shares = $25.10 Est time: 01–05 Balance Sheet Est time: 01–05 Market and Book Values a. In late 2020, investors saw the value of assets on the books of Citigroup as worth less than the value recorded, which may be historical value. Loans are the primary assets for Citigroup, and investors perceived a high likelihood that the loans it made would default. If so, it would need to write down its values, reducing income available to shareholders. b. In contrast to the banks, investors perceived the assets of this company to be worth more than the historical value presented on the company’s book. Consistent with the analysis in Part (a), shareholders in this company are expecting to have higher income in future periods, and the value of the company’s assets are expected to grow. Market and Book Values Est time: 01–05 Noncash Items a. Cash will increase as one current asset (inventory) is exchanged for another (cash). b. Cash will increase. The machine will bring in cash when it is sold, but the lease payments will be made over several years. c. The firm will use cash to buy back the shares from existing shareholders. Cash balance will decrease. Est time: 01–05 Cash Flows Cash Flows Est time: 01–05 Change in Net Working Capital Est time: 06–10 Income Statement a. The fact that start-up firms typically have negative net cash flows for several years does not mean they are failing. Start-up firms invest in inventories and other assets designed to produce income in later periods. Growth is costly, and particularly fast growing firms consume capital in hopes of future gains. b. Accounting profits for start-up businesses are also commonly negative because these firms incur costs, such as advertising, that cannot be recorded on the balance sheet. These costs are selling and general administrative expenses the firm incurs in each period, not investments like those in inventories that are built up for future sales. Est time: 06–10 Cash Flows Est time: 01–05 Operating Cash Flow Est time: 01–05 Operating Cash Flow Candy Canes, Inc. Sales COGS Δ ↑A/R Δ↑ Inventory Cash flow* Net income** Est time: 06–10 Operating Cash Flow Quarter 1 Quarter 2 Quarter 3 Quarter 4 Est time: 11–15 Operating Cash Flow Value Added Inc. (in 000s) January February March April Est time: 11–15 Operating Cash Flow Est time: 11–15 Operating Cash Flow b. Tax increase due to $517 million more in taxable income: $108.57 = ($517 × .21) Est time: 11–15 Operating Cash Flow Est time: 06–10 Taxes Est time: 06–10 Taxes Est time: 06–10 Taxes Est time: 01–05 Taxes Taxes Est time: 06–10 Taxes Assets Liabilities and Shareholders’ Equity Est time: 06–10 Financial Statements Est time: 01–05 Net Working Capital Est time: 06–10 Income Statement Est time: 01–05 Income Statement Est time: 01–05 Financial Statements Assets Liabilities & Market and Book Values Cash provided by operations Cash flows from investments (from Question #35) Cash provided by (used for) financing activities Est time: 06–10 Operating Cash Flow Est time: 01–05 Taxes 660fa14a-021c-4205-a7d8-0631b7f88a04.pdf a. Market value = 657 million × $83 = $54,531 million b. Market / book = 54,531/17,532 = 3.11 c. The company has increased the value of equity investment by $36,999 million, which is 211% of shareholders’ equity on the balance sheet. Est time: 06–10 Market Value Ratios Est time: 06–10 Market Value Ratios a. EVA = after-tax interest + net income − (cost of capital × total capitalization) b. c. d. Yes. The EVA indicates the firm is producing value in excess of the cost of capital. Thus, it is producing value. The ROC and ROE are also consistent with this conclusion. Est time: 06–10 Market Value Ratios Est time: 06–10 Market Value Ratios Est time: 06–10 Profitability Ratios Est time: 01–05 Profitability Ratios a. Return on equity b. Return on assets c. Return on capital d. Days sales in inventory e. Inventory turnover f. Average collection period g. Operating profit margin h. Long-term debt ratio i. Total debt ratio j. Times interest earned k. Cash coverage ratio l. Current ratio m. Quick ratio Profitability Ratios a. Debt/equity = ($60 + 280 + 70)/$190 = 2.58 b. Total long-term debt/total long-term capital = $280/($280 + 190) = 0.60 c. Net working capital = $100 – 60 = $40 d. Current ratio = $100/$60 = 1.67 Est time: 01–05 Profitability Ratios Est time: 01–05 Short-Term Solvency Ratios Est time: 01–05 Short-Term Solvency Ratios Est time: 01–05 Profitability Ratios a. Interest expense = 0.08  $10 million = $800,000 Times interest earned = $1,000,000/$800,000 = 1.25 b. Cash coverage ratio Est time: 01–05 Liquidity Short-Term Solvency Ratios Est time: 06–10 Short-Term Solvency Ratios Asset Management Ratios Long-Term Solvency Ratios Market and Book Values Short-Term olvency Ratios a. No change: Inventory is a current asset as is the proceeds from a sale of inventory. b. Increase: A new bank loan is an increase in a long-term liability. In this case, it is being used to reduce a current liability. c. No change: Unless used, the existence of a line of credit does not impact the balance sheet. d. No change: An overdue accounts receivable, unless already written off, is a current asset. The payment of a receivable is trading one current asset for another. e. No change: Cash and inventory are both current assets. Thus, trading one for the other has no impact. Short-Term Solvency Ratios a. False: A number below 1 implies debt is less than equity and that may not always be the case. b. False: For example, if a firm only has cash, marketable securities, and receivables in its current assets, then the quick ratio will equal the current ratio. While many firms carry inventory, others do not. Est time: 01–05 Profitability Ratios Est time: 06–10 Asset Management Ratios This Year Last Year Financial Statement Analysis Financial Statement Analysis Est time: 01–05 DuPont Identity Est time: 01–05 DuPont Identity DuPont Identity DuPont Identity Est time: 06–10 DuPont Identity 9c5dbe8a-5118-4823-9007-b2ee11b16cb4.pdf Est time: 01–05 Interest Rates Est time: 01–05 Simple and Compound Interest Est time: 01–05 Future Value—Single Period a. $100  (1.08)10 = $215.89 b. $100  (1.08)20 = $466.10 c. $100  (1.04)10 = $148.02 d. $100  (1.04)20 = $219.11 Est time: 01–05 Future Value—Single Period a. With simple interest, you earn 4% of $1,000, or $40 each year. There is no interest on interest. After 10 years, you earn total interest of $400, and your account accumulates to $1,400. b. FV = PV × (1 + r)t Est time: 01–05 Simple and Compound Interest Number of Time Periods Future Value—Single Period = 0.9163/0.1484 = 6.17 years Number of Time Periods a. The present value of the future payoff is PV = FV/(1 + r)t = $2,000/(1.06)10 = $1,116.79. This is a good deal: Present value exceeds the initial investment. b. The present value is now equal to PV = FV/(1 + r)t = $2,000/(1.10)10 = $771.09. Present Value—Single Period Future Value—Single Period Annuities Annuities Present Value—Single Period Est time: 01–05 Present Value—Multiple Cash Flows Present Value Years Future Value Interest Rate Present Value—Single Period Est time: 06–10 Future Value—Single Period Interest Rates a. PV = C1/(1 + r)1 + C2/(1 + r)2 + C3/(1 + r)3 b. The PV exceeds the cost of the factory, so the investment is attractive. Present Value—Multiple Cash Flows Future Value—Single Period Annuities Annuities Perpetuities Perpetuities Perpetuities Perpetuities Annuities Annuities Annuities Annuities Annuities Future Value—Annuity Annuities Annuities Present Value—Annuity a. If we assume cash flows come at the end of each period (ordinary annuity) when in fact they actually come at the beginning (annuity due), we discount each cash flow by one period too many. Therefore, we can obtain the PV of an annuity due by multiplying the PV of an ordinary annuity by (1 + r). b. Similarly, the FV of an annuity due equals the FV of an ordinary annuity multiplied by (1 + r). Because each cash flow comes at the beginning of the period, it has an extra period to earn interest compared to an ordinary annuity. Annuities Annuities Annuities Annuities Future Value—Annuity Future Value—Annuity Present Value—Annuity Future Value—Annuity Time Value of Money Future Value—Annuity Future Value—Annuity Perpetuities Nominal and Real Returns Est time: 06–10 Interest Rates Interest Rates Interest Rates Interest Rates Interest Rates Interest Rates Interest Rates Interest Rates Interest Rates Annuities Continuous Compounding Simple and Compound Interest Simple and Compound Interest Interest Rates Simple and Compound Interest Interest Rates Rule of 72 Time Value of Money Nominal and Real Returns Nominal and Real Returns Nominal and Real Returns Nominal and Real Returns Annuities Interest Rates Nominal and Real Returns Nominal and Real Returns Nominal and Real Returns Est time: 16–20 Present Value—Multiple Cash Flows b855d4ef-878a-445f-b15a-0f22f7fbf1c1.pdf Bond Yields and Returns Bond Yields and Returns a. Coupon payment = 0.08  $1,000 = $80 Bond Yields and Returns Bond Valuation Bond Yields and Returns Bond Yields and Returns Bond Valuation Bond Yields and Returns Bond Valuation Bond Valuation Bond Valuation Bond Valuation Bond Valuation Bond Coupons Bond Yields and Returns Nominal and Real Returns Bond Yields and Returns Bond Yields and Returns Bond Yields and Returns Bond Yields and Returns Nominal and Real Returns Nominal and Real Returns Nominal and Real Returns Interest Rate Risk Interest Rate Risk Interest Rate Risk Interest rate risk Est time: 01–05 Treasury Yield Curve Est time: 01–05 Treasury Yield Curve Est time: 06–10 Bond Ratings and Credit Risk Est time: 06–10 Bond Ratings and Credit Risk a. True. Ignoring reinvestment risk, the promised yield on a treasury will materialize, provided the bond is held to maturity. This bond is assumed to be risk free. b. True. Since corporate bonds have default risk, the actual return has the possibility of being below the promised yield. c. True. If interest rates fall, the price of the bonds will rise and the realized return could increase. Est time: 06–10 Bond Ratings and Credit Risk Bond Ratings and Credit Risk Est time: 01–05 Bond Ratings and Credit Risk Est time: 01–05 Interest Rate Risk f27d259a-f470-4492-8668-3d4044359549.pdf Est time: 01–05 Net Present Value Est time: 01–05 Net Present Value Net Present Value Est time: 01–05 Internal Rate of Return Est time: 01–05 Internal Rate of Return Est time: 01–05 Profitability Index Est time: 01–05 Profitability Index Est time: 01–05 Payback Est time: 01–05 Payback Est time: 01–05 Internal Rate of Return Est time: 01–05 Net Present Value Est time: 06–10 Net Present Value Est time: 01–05 Net Present Value Est time: 06–10 Internal Rate of Return Est time: 06–10 Internal Rate of Return Est time: 01–05 Internal Rate of Return Est time: 11–15 Internal Rate of Return Est time: 01–05 Internal Rate of Return Est time: 01–05 Internal Rate of Return Est time: 01–05 Internal Rate of Return NPV NPV Est time: 11–15 Net Present Value Est time: 01–05 Profitability Index Est time: 06–10 Profitability Index Est time: 06–10 Profitability Index Est time: 06–10 Mutually Exclusive Projects Est time: 01–05 Net Present Value Est time: 06–10 Payback Est time: 01–05 Payback Mutually Exclusive Projects Est time: 16–20 Capital Budgeting Est time: 06–10 Mutually Exclusive Projects Est time: 06–10 Equivalent Annual Costs Est time: 11–15 Equivalent Annual Costs Est time: 11–15 Equivalent Annual Costs Est time: 06–10 Capital Budgeting Est time: 06–10 Capital Budgeting Est time: 06–10 Capital Budgeting Est time: 11–15 Capital Budgeting ecd58ff4-7398-47f0-a8de-cc89074c2cc9.pdf Est time: 01–05 Cash Flows Cash Flows a. If the office space would have remained unused in the absence of the proposed project, then the incremental cash outflow from allocating the space to the project is effectively zero. The incremental cost of the space used should be based on the cash flow given up by allocating the space to this project rather than some other use. b. One reasonable approach would be to assess a cost to the space equal to the rental income that the firm could earn if it allowed another firm to use the space. This is the opportunity cost of the space. Cash Flows Cash Flows Cash Flows b. False. Regardless of the actual financing, you should view the project as if it were all-equity financed, treating all cash outflows required for the project as coming from stockholders and all cash inflows as going to them. Cash Flows Est time: 01–05 Income Statement c. The cash flows: Income Statement Cash Flows b. If the R&D costs have been spent, then they fall into the category of a sunk costs and should be ignored. c. The increase in working capital, exhibited here as an investment in inventories, is an appropriate cash flow. A financial manager may want to consider the recovered working capital investment at the end of the project when the company is able to reduce inventories. d. This note specifies that cash flows are in real terms, instead of nominal, and therefore we should discount the project using a real rate of return. e. The indirect costs should be scrutinized in two ways. First, they should be strictly incremental costs contingent on accepting the new project—if not, then the costs would be incurred anyway and should be excluded from the analysis. Second, by tying the indirect costs to direct labor costs per unit, we want to make sure that the indirect costs are truly variable—if fixed, then they should be held fixed throughout the project life rather than fluctuating with sales volume. f. The marketing and administrative costs should be strictly incremental costs contingent on accepting the new project—if not, then the costs would be incurred anyway and should be excluded from the analysis. g. Depreciation expense in a noncash expense and therefore should not reduce project cash flows. They will reduce taxable income and therefore would actually provide project cash flows. h. Financing decisions should be separate from the investment decision. The project cash flow analysis should assume all-equity financing. i. Income should be adjusted for all items mentioned above. j. The tax loss carry forwards may not be realized if the firm has other profitable business segments. In this case, the loss recorded in Year 2022 should reduce the tax bill in that year. k. The net cash flow calculation should be adjusted for all items aforementioned. l. The net present value calculation should reflect correctly calculated cash flows. Also, since the cash flows are stated in real terms, the 15% discount rate must be a real cost of capital. Est time: 05–10 Operating Cash Flow Est time: 01–05 Operating Cash Flow Est time: 06–10 Equivalent Annual Costs Est time: 11–15 Net Present Value d. To find the internal rate of return, find the interest rate “r” that makes the present value of the inflows equal and opposite to the initial outflow. To do this set the PV of the 3-year annuity to $71.50 and solve for the discount rate (r): Est time: 11–15 Project Analysis and Evaluation Est time: 11–15 Project Evaluation Est time: 06–10 Project Evaluation c. Since the operating costs are the same, then Do-It-Right is preferred because it has the lower EAC. Est time: 11–15 Project Evaluation Est time: 06–10 Project Evaluation Est time: 16-20 Project Analysis and Evaluation Est time: 16-20 Est time: 01–05 Cash Flows Est time: 01–05 Cash Flow From Assets Est time: 01–05 Cash Flow From Assets Est time: 11–15 Depreciation b. If the company depreciates the installation costs, the present value of the tax shields will be less than if they can shield income immediately and thus the present value of the kiln cost will be greater. To calculate the tax shields in this scenario, we can schedule depreciation tax shields as follows: Est time: 06–10 Operating Cash Flow Est time: 01–05 Change in Net Working Capital Est time: 01–05 Change in Net Working Capital Est time: 01–05 Change in Net Working Capital Cash Flows Est time: 01–05 Change in Net Working Capital Est time: 06–10 Net Present Value Project Analysis and Evaluation Est time: 11–15 Project Analysis and Evaluation All figures in thousands Est time: 11–15 Project Analysis and Evaluation 1586508d-b693-40a3-8d2a-dd0f56a47518.pdf Project Analysis and Evaluation Project Analysis and Evaluation Project Analysis and Evaluation The extra 2 million burgers increase total costs by $1.0 million. a. Fixed costs = $2.5 million b. Variable costs = $0.50 per burger c. Total cost = (1 million burgers × $0.50) + $2.5 million = $3.0 million d. Total cost = (2 million burgers × $0.50) + $2.5 million = $3.5 million e. The fixed costs are spread across more burgers—thus the average cost falls. Operating Leverage Est time: 06–10 Sensitivity analysis a. Initial investment = $225  NPV = −$44.94 b. Initial investment = $150  NPV = $18.70 c. Initial investment = $113  NPV = $50.52 d. Revenues = $128  NPV = −$21.10 e. Revenues = $150  NPV = $18.70 f. Revenues = $180  NPV = $71.77 g. Variable costs, % of Revenues = 44%  NPV = −$0.40 h. Variable costs, % of Revenues = 40%  NPV = $18.70 i. Variable costs, % of Revenues = 36%  NPV = $37.80 j. Fixed costs = 60  NPV = −$44.97 k. Fixed costs = 40  NPV = $18.70 l. Fixed costs = 28  NPV = $56.90 m. Receivables and inventory, % of Exp. value = 25.00%, 22.50%  NPV = $9.88 n. Receivables and inventory, % of Exp. value = 16.67%, 15.00%  NPV = $18.70 o. Receivables and inventory, % of Exp. value = 8.33%, 7.50%  NPV = $27.52 Est time: 06–10 Sensitivity Analysis Est time: 06–10 Sensitivity Analysis Sensitivity Analysis Scenario Analysis Break-Even Analysis a. Each dollar of sales generates $0.60 of pretax profit. Depreciation expense is $100,000 per year, and fixed costs are $200,000. Therefore: b. Let Q = the number of diamonds sold. Break-Even Analysis Break-Even Analysis a. Cash flow = Net income + Depreciation b. If cash flow = 0 for the entire life of the project, then the present value of cash flows = 0, and project NPV will be negative in the amount of the required investment. Break-Even Analysis Break-Even Analysis a. The accounting break-even level of sales would INCREASE if the depreciation were pushed earlier. This is counterintuitive, but looking at the equation above, if the depreciation of 600 increases, then M increases in our equation to keep up. The reason is that under accounting rules, depreciation counts as a cost, and hence more cost earlier drives UP the number of units we must sell to break even. b. NPV break-even level of sales decreases. The accelerated depreciation increases the PV of the tax shield and thus reduces the level of sales necessary to achieve zero NPV. c. Accelerated depreciation makes the project more attractive. The PV of the tax shield is higher, so the NPV of the project at any given level of sales is higher. Break-Even Analysis Break-Even Analysis Operating Leverage Operating Leverage Operating Leverage Operating Leverage a. The option to delay expansion is a Timing Option because the decision to expand is not a “now or never” decision. b. While the initial NPV is negative, the existence of the production capability gives the company the Option to Expand when the market demand rises. c. By delaying installation of a fully integrated production line, the company retains its Option to Abandon and can upgrade to newer technology if it emerges. d. The ability to switch the use of the plane gives the company a Production Flexibility Option. Est time: 06–10 Real Options Real Options Real Options Real Options Real Options Real Options c7d0f7ff-83f9-4d3e-8bfa-467931e0d2a0.pdf a. For the period 1900–2019, average rate of return = 11.46% (see Table 11-1). b. For the period 1900–2019, average risk premium = 7.73% (see Table 11-1). c. For the period 1900–2019, standard deviation of returns = 19.61% (see Table 11-4). Historical Performance Risk Premium Risk Premium Est time: 01–05 Risk Premium Risk Premium Est time: 11–15 Standard Deviation and Variance a. b. Dividend yield = Dividend/Initial share price = $2/$40 = 0.05 = 5% Capital gains yield = Capital gain/Initial share price = $4/$40 = 0.10 = 10% c. Dividend yield = $2/$40 = 0.05 = 5% Dollar and Percentage Returns Est time: 06–10 Nominal and Real Returns Nominal and Real Returns Nominal and Real Returns Stock Market Prices and Reporting Stock Market Prices and Reporting Standard Deviation and Variance Standard Deviation and Variance Standard Deviation and Variance Standard Deviation and Variance Standard Deviation and Variance Standard Deviation and Variance Est time: 01–05 Diversification Concepts and Measures Diversification Concepts and Measures Systematic and Unsystematic Risk 16749e95-7672-4fbb-8b3d-e76c30fc2af1.pdf Diversification Concepts and Measures Systematic and Unsystematic Risk Systematic and Unsystematic Risk Risks and Returns Beta a. Call the weight in the S&P 500 w and the weight in T-bills (1 − w). Then w must satisfy the equation: b. To form a portfolio with  = 0.4, use a weight of 0.40 in the S&P 500 and a weight of 0.60 in T-bills. Then the portfolio  is: c. Both portfolios have the same ratio of risk premium to : Beta Beta Risks and Returns Capital Asset Pricing Model Capital Asset Pricing Model Capital Asset Pricing Model c. If the market return remained at 8% and the risk-free rate increased to 6%  the market risk premium must fall to 2% (from 7%). The new expected returns are: d. Comparing the higher risk-free rate with Table 12.2 yields the following: e. As shown in Part (d), Walmart, with its low beta, benefits from a higher risk-free rate, increasing expected returns from 3.48% to 6.71%. Capital Asset Pricing Model Expected Return Capital Asset Pricing Model a. If investors believe the year-end stock price will be $52, then the expected return on the stock is: b. Alternatively, the “fair” price of the stock (i.e., the present value of the investor’s expected cash flows) is: Capital Asset Pricing Model Capital Asset Pricing Model Capital Asset Pricing Model a. False. Investors require higher expected rates of return on investments with high market risk, not high total risk. Variability of returns is a measure of total risk. b. False. If  = 0, then the asset’s expected return should equal the risk-free rate, not zero. c. False. The portfolio is invested one third in Treasury bills and two thirds in the market. Its  will be: d. True. The asset’s beta is a function of its sensitivity to macroeconomic risks, among other factors. e. True. This is exactly what beta measures. Risks and Returns Capital Asset Pricing Model Risk Analysis and Profile Capital Asset Pricing Model a. False. The stock’s risk premium, not its expected rate of return, is twice as high as the risk premium of the market portfolio. b. True. The stock’s specific risk does not affect its contribution to portfolio risk. c. False. A stock plotting below the SML offers too low an expected return relative to the expected return indicated by the CAPM. The stock is overpriced. d. True. If the portfolio is diversified to such an extent that it has negligible unique risk, then the only source of volatility is its market exposure. A  of 2 then implies twice the volatility of the market portfolio. e. False. An undiversified portfolio has more than twice the volatility of the market. In addition to the fact that it has double the sensitivity to market risk, it also has volatility due to specific risk. Risks and Returns Capital Asset Pricing Model Required Return Required Return Capital Asset Pricing Model Capital Asset Pricing Model Capital Asset Pricing Model Capital Asset Pricing Model Capital Asset Pricing Model Capital Asset Pricing Model Capital Asset Pricing Model Required Return 32ecbc71-3c20-48f7-a7f2-1afc274871cf.pdf Weighted-Average Cost of Capital Est time: 01–05 Weighted-Average Cost of Capital Weighted-Average Cost of Capital Weighted-Average Cost of Capital Weighted-Average Cost of Capital Weighted-Average Cost of Capital Est time: 06–10 Weighted-Average Cost of Capital Weighted-Average Cost of Capital Weighted-Average Cost of Capital a. The risk of the project determines the discount rate, and in this case Geothermal’s WACC is more reflective of the risk of the project in question. The proper discount rate, therefore, is not 12.3%. b. Executive Fruit should use the WACC of Geothermal, not its own WACC, when evaluating an investment in geothermal power production. It is more likely to be 11.7%. Weighted-Average Cost of Capital a. r = rf +  × (rm − rf) = 4% + (1.2  10%) = 16% c. If the company plans to expand its present business, then the WACC is a reasonable estimate of the discount rate since the risk of the proposed project is similar to the risk of the existing projects. Use a discount rate of 10.864%. d. The WACC of optical projects should be based on the risk of those projects. Using a  of 1.4, the discount rate for the new venture is: Weighted-Average Cost of Capital Weighted-Average Cost of Capital Weighted-Average Cost of Capital Est time: 01–05 Weighted-Average Cost of Capital a. b. c. Market value is the proper measure, as it is determined by cash flows and forecasts, rather than accounting rules. Capital Structure Est time: 01–05 Capital Structure Est time: 01–05 Capital Structure Cost of Debt Cost of Equity Cost of Debt Est time: 01–05 Cost of Preferred Stock Cost of Equity Est time: 01–05 Weighted-Average Cost of Capital Weighted-Average Cost of Capital Weighted-Average Cost of Capital 71c6b8e1-687e-4e9c-838c-48791bed90eb.pdf a. False. Because of efficient markets, it is difficult to find undervalued securities or issue overvalued securities. Thus, good investment decisions are more valuable to owners. b. False. Competition is an important component in creating efficient markets. With sufficient competition between investors, securities will be properly valued. Est time: 01–05 Capital Market Efficiency b. True. c. False. Debt ratios in the United States increased until about 1990, but since then they have generally declined. Est time: 01–05 Capital Market Efficiency Est time: 01–05 Equity Securities Equity Securities Equity Securities a. Par value of common shares will increase by: Est time: 06–10 Equity Securities a. A company’s equity includes both common and preferred stock. True. b. The sum of common equity and preferred stock is known as net worth. False. c. As its name implies, preferred stock is a more important source of financing than common equity. False. d. A corporation pays tax on only 50% of the common or preferred dividends it receives from other corporations. True. e. Because of the tax advantage, a large fraction of preferred shares is held by corporations. True. Est time: 01–05 Preferred Stock Features Preferred Stock Features Est time: 01–05 Capital Structure and Taxes a. Yes. The company has the option to buy back the notes. The redemption price is the greater of $1,000 or a price that is determined by the value of an equivalent Treasury bond. b. The annual coupon is $58.05, paid in two installments of $29.03 each. c. No. While these notes are not secured, they are senior debt, and if Boeing sets aside assets to protect any other bondholders, the notes will also be secured by these assets. This is called a negative pledge clause. d. No. Moody’s bond rating is Baa, the fourth highest quality rating. It is characterized by “adequate payment capacity” and is the lowest investment grade rating. e. The bonds are repaid in one lump sum at maturity, in 2050. f. Since the debt is due in 2050 and is longer than 1 year, it is considered funded debt. Est time: 01–05 Bond Features Bond Types a. Debt maturing in more than 1 year is often called funded debt. b. An issue of bonds that is sold simultaneously in several countries is traditionally called a Eurobond. c. If a lender ranks behind the firm’s general creditors in the event of default, the loan is said to be junior. d. In many cases a firm is obliged to make regular contributions to a sinking fund, which is then used to repurchase bonds. e. Some bonds give the firm the right to repurchase or call the bonds at specified prices. f. The benchmark interest rate that banks charge to their customers with good credit is generally termed the prime rate. g. The interest rate on bank loans is often tied to short‐term interest rates. These loans are usually called floating rate loans. h. Where there is a private placement, securities are sold directly to a small group of institutional investors. These securities cannot be resold to individual investors. i. In the case of a public issue, debt can be freely boug

This text explains the "why" and "how" behind a company's financial decisions and goals of value maximization. Focusing on setting out the basic principles of financial management and applying them to the main decisions faced by the financial manager, it looks at how companies add value.

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__**Fundamentals of Corporate Finance**__, by Brealey, Myers and Marcus, provides students with a solid framework of theory and application to use well after they complete the course. This author team is known for their outstanding research, teaching efforts, and world-renowned finance textbooks, so it's no surprise that they provide clear exposition of difficult material without sacrificing up-to-date, technically correct treatments. And with the Ninth Edition, McGraw-Hill's Connect(R) empowers students by continually adapting to deliver precisely what they need, when they need it, and how they need it, so your class time is more engaging and effective.

Cover Title Copyright About The Authors Preface Acknowledgments Contents in Brief Contents Part One: Introduction Chapter 1 Goals and Governance of the Corporation 1.1 Investment and Financing Decisions The Investment (Capital Budgeting) Decision The Financing Decision 1.2 What Is a Corporation? Other Forms of Business Organization 1.3 Who Is the Financial Manager? 1.4 Goals of the Corporation Shareholders Want Managers to Maximize Market Value 1.5 Agency Problems, Executive Compensation, and Corporate Governance Executive Compensation Corporate Governance 1.6 The Ethics of Maximizing Value 1.7 Careers in Finance 1.8 Preview of Coming Attractions 1.9 Snippets of Financial History Summary Questions and Problems Chapter 2 Financial Markets and Institutions 2.1 The Importance of Financial Markets and Institutions 2.2 The Flow of Savings to Corporations The Stock Market Other Financial Markets Financial Intermediaries Financial Institutions Total Financing of U.S. Corporations 2.3 Functions of Financial Markets and Intermediaries Transporting Cash across Time Risk Transfer and Diversification Liquidity The Payment Mechanism Information Provided by Financial Markets 2.4 The Crisis of 2007–2009 Summary Questions and Problems Chapter 3 Accounting and Finance 3.1 The Balance Sheet Book Values and Market Values 3.2 The Income Statement Income versus Cash Flow 3.3 The Statement of Cash Flows Free Cash Flow 3.4 Accounting Practice and Malpractice 3.5 Taxes Corporate Tax Personal Tax Summary Questions and Problems Chapter 4 Measuring Corporate Performance 4.1 How Financial Ratios Relate to Shareholder Value 4.2 Measuring Market Value and Market Value Added 4.3 Economic Value Added and Accounting Rates of Return Accounting Rates of Return Problems with EVA and Accounting Rates of Return 4.4 Measuring Efficiency 4.5 Analyzing the Return on Assets: The Du Pont System The Du Pont System 4.6 Measuring Financial Leverage Leverage and the Return on Equity 4.7 Measuring Liquidity 4.8 Interpreting Financial Ratios 4.9 The Role of Financial Ratios Summary Questions and Problems Minicase Part Two: Value Chapter 5 The Time Value of Money 5.1 Future Values and Compound Interest 5.2 Present Values Finding the Interest Rate 5.3 Multiple Cash Flows Future Value of Multiple Cash Flows Present Value of Multiple Cash Flows 5.4 Reducing the Chore of the Calculations: Part 1 Using Financial Calculators to Solve Simple Time-Value-of-Money Problems Using Spreadsheets to Solve Simple Time-Value-of-Money Problems 5.5 Level Cash Flows: Perpetuities and Annuities How to Value Perpetuities How to Value Annuities Future Value of an Annuity Annuities Due 5.6 Reducing the Chore of the Calculations: Part 2 Using Financial Calculators to Solve Annuity Problems Using Spreadsheets to Solve Annuity Problems 5.7 Effective Annual Interest Rates 5.8 Inflation and the Time Value of Money Real versus Nominal Cash Flows Inflation and Interest Rates Valuing Real Cash Payments Real or Nominal? Summary Questions and Problems Minicase Chapter 6 Valuing Bonds 6.1 The Bond Market Bond Characteristics 6.2 Interest Rates and Bond Prices How Bond Prices Vary with Interest Rates Interest Rate Risk 6.3 Yield to Maturity Calculating the Yield to Maturity 6.4 Bond Rates of Return 6.5 The Yield Curve Nominal and Real Rates of Interest 6.6 Corporate Bonds and the Risk of Default Protecting against Default Risk Not All Corporate Bonds Are Plain Vanilla Summary Questions and Problems Chapter 7 Valuing Stocks 7.1 Stocks and the Stock Market Reading Stock Market Listings 7.2 Market Values, Book Values, and Liquidation Values 7.3 Valuing Common Stocks Valuation by Comparables Price and Intrinsic Value The Dividend Discount Model 7.4 Simplifying the Dividend Discount Model Case 1: The Dividend Discount Model with No Growth Case 2: The Dividend Discount Model with Constant Growth Case 3: The Dividend Discount Model with Nonconstant Growth 7.5 Valuing a Business by Discounted Cash Flow Valuing the Concatenator Business Repurchases and the Dividend Discount Model 7.6 There Are No Free Lunches on Wall Street Random Walks and Efficient Markets 7.7 Market Anomalies and Behavioral Finance Market Anomalies Bubbles and Market Efficiency Behavioral Finance Summary Questions and Problems Minicase Chapter 8 Net Present Value and Other Investment Criteria 8.1 Net Present Value A Comment on Risk and Present Value Valuing Long-Lived Projects Choosing between Alternative Projects 8.2 The Internal Rate of Return Rule A Closer Look at the Rate of Return Rule Calculating the Rate of Return for Long-Lived Projects A Word of Caution Some Pitfalls with the Internal Rate of Return Rule 8.3 The Profitability Index Capital Rationing Pitfalls of the Profitability Index 8.4 The Payback Rule Discounted Payback 8.5 More Mutually Exclusive Projects Problem 1: The Investment Timing Decision Problem 2: The Choice between Long- and Short-Lived Equipment Problem 3: When to Replace an Old Machine 8.6 A Last Look Summary Questions and Problems Minicase Appendix: More on the IRR Rule Using the IRR to Choose between Mutually Exclusive Projects Using the Modified Internal Rate of Return When There Are Multiple IRRs Chapter 9 Using Discounted Cash-Flow Analysis to Make Investment Decisions 9.1 Identifying Cash Flows Discount Cash Flows, Not Profits Discount Incremental Cash Flows Discount Nominal Cash Flows by the Nominal Cost of Capital Separate Investment and Financing Decisions 9.2 Corporate Income Taxes 9.3 An Example—Blooper Industries Forecasting Blooper's Cash Flows Calculating the NPV of Blooper's Mine Further Notes and Wrinkles Arising from Blooper's Project Summary Questions and Problems Minicase Chapter 10 Project Analysis 10.1 How Firms Organize the Investment Process to Draw on Their Competitive Strengths The Capital Budget Problems and Some Solutions 10.2 Reducing Forecast Bias 10.3 Some "What-If" Questions Sensitivity Analysis Scenario Analysis 10.4 Break-Even Analysis Accounting Break-Even Analysis NPV Break-Even Analysis Operating Leverage 10.5 Real Options and the Value of Flexibility The Option to Expand A Second Real Option: The Option to Abandon A Third Real Option: The Timing Option A Fourth Real Option: Flexible Production Facilities Summary Questions and Problems Minicase Part Three: Risk Chapter 11 Introduction to Risk, Return, and the Opportunity Cost of Capital 11.1 Rates of Return: A Review 11.2 A Century of Capital Market History Market Indexes The Historical Record Using Historical Evidence to Estimate Today's Cost of Capital 11.3 Measuring Risk Variance and Standard Deviation A Note on Calculating Variance Measuring the Variation in Stock Returns 11.4 Risk and Diversification Diversification Asset versus Portfolio Risk Market Risk versus Specific Risk 11.5 Thinking about Risk Message 1: Some Risks Look Big and Dangerous but Really Are Diversifiable Message 2: Market Risks Are Macro Risks Message 3: Risk Can Be Measured Summary Questions and Problems Chapter 12 Risk, Return, and Capital Budgeting 12.1 Measuring Market Risk Measuring Beta Betas for Ford and PG&E Total Risk and Market Risk 12.2 What Can You Learn from Beta? Portfolio Betas The Portfolio Beta Determines the Risk of a Diversified Portfolio 12.3 Risk and Return Why the CAPM Makes Sense The Security Market Line Using the CAPM to Estimate Expected Returns How Well Does the CAPM Work? 12.4 The CAPM and the Opportunity Cost of Capital The Company Cost of Capital What Determines Project Risk? Don't Add Fudge Factors to Discount Rates Summary Questions and Problems Chapter 13 The Weighted-Average Cost of Capital and Company Valuation 13.1 Geothermal's Cost of Capital 13.2 The Weighted-Average Cost of Capital Calculating Company Cost of Capital as a Weighted Average Use Market Weights, Not Book Weights Taxes and the Weighted-Average Cost of Capital What If There Are Three (or More) Sources of Financing? The NPV of Geothermal's Expansion Checking Our Logic 13.3 Interpreting the Weighted-Average Cost of Capital When You Can and Can't Use WACC Some Common Mistakes How Changing Capital Structure Affects Expected Returns What Happens When the Corporate Tax Rate Is Not Zero 13.4 Practical Problems: Measuring Capital Structure 13.5 More Practical Problems: Estimating Expected Returns The Expected Return on Bonds The Expected Return on Common Stock The Expected Return on Preferred Stock Adding It All Up Real-Company WACCs 13.6 Valuing Entire Businesses Calculating the Value of the Deconstruction Business Summary Questions and Problems Minicase Part Four: Financing Chapter 14 Introduction to Corporate Financing 14.1 Creating Value with Financing Decisions 14.2 Patterns of Corporate Financing Are Firms Issuing Too Much Debt? 14.3 Common Stock Ownership of the Corporation Voting Procedures Classes of Stock 14.4 Preferred Stock 14.5 Corporate Debt Debt Comes in Many Forms Innovation in the Debt Market 14.6 Convertible Securities Summary Questions and Problems Chapter 15 How Corporations Raise Venture Capital and Issue Securities 15.1 Venture Capital Venture Capital Companies 15.2 The Initial Public Offering Arranging a Public Issue Other New-Issue Procedures The Underwriters 15.3 General Cash Offers by Public Companies General Cash Offers and Shelf Registration Costs of the General Cash Offer Market Reaction to Stock Issues 15.4 The Private Placement Summary Questions and Problems Minicase Appendix: Hotch Pot's New-Issue Prospectus Part Five: Debt and Payout Policy Chapter 16 Debt Policy 16.1 How Borrowing Affects Value in a Tax-Free Economy MM's Argument—A Simple Example How Borrowing Affects Earnings per Share How Borrowing Affects Risk and Return 16.2 Debt and the Cost of Equity No Magic in Financial Leverage 16.3 Debt, Taxes, and the Weighted-Average Cost of Capital Debt and Taxes at River Cruises How Interest Tax Shields Contribute to the Value of Stockholders' Equity Corporate Taxes and the Weighted-Average Cost of Capital The Implications of Corporate Taxes for Capital Structure 16.4 Costs of Financial Distress Bankruptcy Costs Costs of Bankruptcy Vary with Type of Asset Financial Distress without Bankruptcy 16.5 Explaining Financing Choices The Trade-Off Theory A Pecking Order Theory The Two Faces of Financial Slack Is There a Theory of Optimal Capital Structure? Summary Questions and Problems Minicase Appendix: Bankruptcy Procedures Chapter 17 Payout Policy 17.1 How Corporations Pay Out Cash to Shareholders How Firms Pay Dividends Limitations on Dividends Stock Dividends and Stock Splits Stock Repurchases 17.2 The Information Content of Dividends and Repurchases 17.3 Dividends or Repurchases? The Payout Controversy Dividends or Repurchases? An Example Repurchases and the Dividend Discount Model Dividends and Share Issues 17.4 Why Dividends May Increase Value 17.5 Why Dividends May Reduce Value Taxation of Dividends and Capital Gains under Current Tax Law Taxes and Payout—A Summary 17.6 Payout Policy and the Life Cycle of the Firm Summary Questions and Problems Minicase Part Six: Financial Analysis and Planning Chapter 18 Long-Term Financial Planning 18.1 What Is Financial Planning? Why Build Financial Plans? 18.2 Financial Planning Models Components of a Financial Planning Model 18.3 A Long-Term Financial Planning Model for Dynamic Mattress Pitfalls in Model Design Choosing a Plan 18.4 External Financing and Growth Summary Questions and Problems Minicase Chapter 19 Short-Term Financial Planning 19.1 Links between Long-Term and Short-Term Financing Tax Strategies Reasons to Hold Cash 19.2 Tracing Changes in Cash 19.3 Cash Budgeting Preparing the Cash Budget 19.4 Dynamic's Short-Term Financial Plan Dynamic Mattress's Financing Plan Evaluating the Plan A Note on Short-Term Financial Planning Models Summary Questions and Problems Minicase Chapter 20 Working Capital Management 20.1 Working Capital Components of Working Capital Working Capital and the Cash Cycle 20.2 Accounts Receivable and Credit Policy Terms of Sale Credit Agreements Credit Analysis The Credit Decision Collection Policy 20.3 Inventory Management 20.4 Cash Management Check Handling and Float Other Payment Systems Electronic Funds Transfer International Cash Management 20.5 Investing Idle Cash: The Money Market Money Market Investments Calculating the Yield on Money Market Investments Yields on Money Market Investments The International Money Market 20.6 Managing Current Liabilities: Short-Term Debt Bank Loans Commercial Paper Summary Questions and Problems Minicase Part Seven: Special Topics Chapter 21 Mergers, Acquisitions, and Corporate Control 21.1 Sensible Motives for Mergers Economies of Scale Economies of Vertical Integration Combining Complementary Resources Mergers as a Use for Surplus Funds Eliminating Inefficiencies Industry Consolidation Taxes and Cross-Border Mergers 21.2 Dubious Reasons for Mergers Diversification The Bootstrap Game 21.3 The Mechanics of a Merger The Form of Acquisition Mergers, Antitrust Law, and Popular Opposition 21.4 Evaluating Mergers Mergers Financed by Cash Mergers Financed by Stock A Warning Another Warning 21.5 The Market for Corporate Control 21.6 Method 1: Proxy Contests 21.7 Method 2: Takeovers 21.8 Method 3: Leveraged Buyouts Barbarians at the Gate? 21.9 Method 4: Divestitures, Spin-Offs, and Carve-Outs 21.10 The Benefits and Costs of Mergers Merger Waves Summary Questions and Problems Minicase Chapter 22 International Financial Management 22.1 Foreign Exchange Markets Spot Exchange Rates Forward Exchange Rates 22.2 Some Basic Relationships Exchange Rates and Inflation Real and Nominal Exchange Rates Inflation and Interest Rates The Forward Exchange Rate and the Expected Spot Rate Interest Rates and Exchange Rates 22.3 Hedging Currency Risk Transaction Risk Economic Risk 22.4 International Capital Budgeting Net Present Values for Foreign Investments Political Risk The Cost of Capital for Foreign Investment Avoiding Fudge Factors Summary Questions and Problems Minicase Chapter 23 Options 23.1 Calls and Puts Selling Calls and Puts Payoff Diagrams Are Not Profit Diagrams Financial Alchemy with Options Some More Option Magic 23.2 What Determines Option Values? Upper and Lower Limits on Option Values The Determinants of Option Value Option-Valuation Models 23.3 Spotting the Option Options on Real Assets Options on Financial Assets Summary Questions and Problems Chapter 24 Risk Management 24.1 Why Hedge? The Evidence on Risk Management 24.2 Reducing Risk with Options 24.3 Futures Contracts The Mechanics of Futures Trading Commodity and Financial Futures 24.4 Forward Contracts 24.5 Swaps Interest Rate Swaps Currency Swaps And Some Other Swaps 24.6 Innovation in the Derivatives Market 24.7 Is "Derivative" a Four-Letter Word? Summary Questions and Problems Part Eight: Conclusion 25 What We Do and Do Not Know about Finance 25.1 What We Do Know: The Six Most Important Ideas in Finance Net Present Value (Chapter 5) Risk and Return (Chapters 11 and 12) Efficient Capital Markets (Chapter 7) MM's Irrelevance Propositions (Chapters 16 and 17) Option Theory (Chapter 23) Agency Theory 25.2 What We Do Not Know: Nine Unsolved Problems in Finance What Determines Project Risk and Present Value? Risk and Return—Have We Missed Something? Are There Important Exceptions to the Efficient-Market Theory? Is Management an Off-Balance-Sheet Liability? How Can We Explain Capital Structure? How Can We Resolve the Payout Controversy? How Can We Explain Merger Waves? What Is the Value of Liquidity? Why Are Financial Systems Prone to Crisis? 25.3 A Final Word Questions and Problems Appendix A: Present Value and Future Value Tables Glossary A B C D E F G H I J L M N O P Q R S T U V W X Y Z Index A B C D E F G H I J K L M N O P Q R S T U V W Y Z

Fundamentals of Corporate Finance , by Brealey, Myers and Marcus, provides students with a solid framework of theory and application to use well after they complete the course. This author team is known for their outstanding research, teaching efforts, and world-renowned finance textbooks, so it's no surprise that they provide clear exposition of difficult material without sacrificing up-to-date, technically correct treatments. The seventh edition has been fully updated to reflect recent events and is now available with Connect Finance ! Connect is the only integrated learning system that empowers students by continuously adapting to deliver precisely what they need, when they need it, and how they need it, so that your class time is more engaging and effective.

This text balances core coverage of the fundamental topics in corporate finance with an emphasis on modern business decision-making. The key principles and mechanics of the time value of money - a central concept - are carefully detailed and illustrated.

Prepared by Bruce Swensen of Adelphi University this resource contains solutions to all end of chapter problems for easy reference.

本书是一本经典的公司理财入门教材,旨在介绍公司理财的理论及实务知识,集中讨论了公司如何进行实物资产投资及怎样筹集所需资金.作者以价值最大化为目标,立足于金融市场;以风险与收益权衡为核心,以财务决策框架为主线,构造结构体系.主要涉及价值,风险,筹资,负债政策与分配政策,财务分析与财务计划等内容

Richard A. Brealey, Stewart C. Myers, Alan J. Marcus. Includes Bibliographical References And Index. System Requirements For Accompanying Computer Disc: Microsoft Windows 95 Or Higher, Microsoft Excel 97 Or Higher, And Either Netscape Navigator 4.0 Or Higher, Or Microsoft Internet Explorer 4.0 Or Higher.

The Focus Of Brealey Et Al. Fundamentals Of Corporate Finance Is On Applying Modern Finance Principles, Providing Students With The Ability To Make Financial Decisions As Future Business Professionals. It Also Delivers A Broad Introduction To The Financial Landscape Discussing The Major Players In Financial Markets, The Role Of Financial Institutions In The Economy, And How Securities Are Traded And Valued By Investors. Recognized For Outstanding Research, Teaching Excellence, And Their Market Leading Finance Texts, The Author Team's Writing Style And Approach Sets It Apart From Others - Relaxed, Interesting, And Readable - Making The Content More Inviting For Students. Brealey Integrates Current, Real World Applications, A Variety Of Problem Material And Mini Cases For Students To Practice And Apply Their Knowledge.

EDGT2248672Autore vincitore Premio LeggimontagnaNegli anni Cinquanta del secolo scorso furono raggiunte per la prima volta le vette di dieci dei quattordici Ottomila, tra cui l’Everest, salito dal versante nepalese nel 1953 da Tenzing e Hillary. I sovietici sognano l’affermazione di un «alpinismo socialista» e, a questo scopo, puntano alla conquista dell’Everest dal lato tibetano, ormai chiuso agli occidentali, insieme agli alpinisti cinesi di scuola sovietica. La data fissata è marzo 1959, decimo anniversario della proclamazione della Repubblica popolare cinese. Ma la rivolta tibetana manda a monte il progetto. Il governo cinese, a sua volta, nutre ambizioni ancora diverse: è l’epoca del Grande balzo in avanti e della colonizzazione del Tibet a tappe forzate, poco importa se il paese è decimato dalla carestia. In quest’ottica, la scalata dell’Everest non è né un’eroica prodezza individuale né una gloriosa impresa patriottica: è una conquista militare di un territorio, comprese le sue zone più inaccessibili e vertiginose. Una volta soffocata nel sangue la rivolta, nel 1960 i cinesi organizzano la loro spedizione e il 25 maggio dello stesso anno gli alpinisti Qu Yinhua, Wang Fuzhou e Gonpo dichiarano di aver raggiunto gli 8848 metri del Qomolangma (il nome tibetano dell’Everest) dal versante nord. È vero? Di sicuro gli alpinisti sono dotati di un senso del dovere e di una voglia di vincere eccezionali che compensano lacune tecniche e carenze organizzative. La propaganda proclama al mondo intero l’avvenuta conquista e la narrazione ufficiale non verrà mai cambiata di una virgola, anche se prove certe non ce ne sono, le relazioni sono piene di punti oscuri e non esistono foto. Ancora oggi, a più di sessant’anni da questa gigantesca impresa – che ha coinvolto più di duecento uomini e per la quale sono stati costruiti 380 chilometri di strada – non si è arrivati a una conclusione certa...

The Focus Of Brealey Et Al. Fundamentals Of Corporate Finance Is On Applying Modern Finance Principles, Providing Students With The Ability To Make Financial Decisions As Future Business Professionals. It Also Delivers A Broad Introduction To The Financial Landscape Discussing The Major Players In Financial Markets, The Role Of Financial Institutions In The Economy, And How Securities Are Traded And Valued By Investors. Recognized For Outstanding Research, Teaching Excellence, And Their Market Leading Finance Texts, The Author Team's Writing Style And Approach Sets It Apart From Others - Relaxed, Interesting, And Readable - Making The Content More Inviting For Students. Brealey Integrates Current, Real World Applications, A Variety Of Problem Material And Mini Cases For Students To Practice And Apply Their Knowledge.