Finance 150 – FUndamentals of Finance

All readings should be completed prior to lecture

 

Syllabus  (PDF)          Grading Scale     Calculators             

 

DATES

TOPICS

READINGS AND ASSIGNMENTS

Week 1

 

August

22, 24

Introduction to

Financial Management

Text: (RWJ) Reading: Chapter 1

Chapter 1 Lecture - Introduction to Financial Management  (PPT)

Websites: Qatar Stock Index     World Stock Indexes     YahooFinance

Videos: Agency Problem and Control of the Corporation     Financial Markets and the Corporation

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Assignment: (Does not need to be handed in). Peruse the websites of some of the major stock indexes.

Week 2

 

August

29, 31

Financial Statements,

Taxes, and Cash Flow

Text: (RWJ) Reading: Chapter 2

Chapter 2 Lecture – Financial Statements, Taxes, and Cash Flow  (PPT)

Resources: Beginners' Guide to Financial Statements     Cash Flow Summary     How to Read a Financial Report (No Need to Download)

Videos: Cash Flow From Assets Further Explained     How to Read a Balance Sheet     How to Read an Income Statement 

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Assignment: Practice Problems Chapter 2 (Material will be on Exam 1)   (Answers)      Chapter Review and Self-Test Problem     Income and Balance Sheet Problem

Week 3

 

September

5, 7

Working with Financial Statements

Text: (RWJ) Reading: Chapter 3

Chapter 3 Lecture – Working with Financial Statements (PPT)     Who Uses Financial Statement Analysis?  (PPT)

Financial Ratio Example – Norton Corporation  (PPT)

Resources: Common Financial Ratios     How and Why Do Companies Pay Dividends?

Websites: Financial Ratios Calculator     Investing.com     Reuters     YahooFinance

Videos: Financial Ratio Analysis

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Assignment:  Text Chapter 3 - Questions and Problems: Question 35     (Answers)

Week 4

 

September

12, 14

Introduction to Valuation: The Time Value of Money

Text: (RWJ) Reading: Chapter 4

Chapter 4 Lecture - Introduction to Valuation: The Time Value of Money   (PPT)

Resources: Summary of Time Value Calculations

Videos: Calculating FV (Future Value) in Excel     Calculating RATE (Interest or Discount Rate) in Excel   

Calculating PV(Present Value) in Excel     Calculating the Number of Periods (NPER) in Excel

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Assignment:  Text Chapter 4 - Questions and Problems: Questions 1, 2, 3, 4, 5, 24     (Answers)

Practice Problems for Exam 1 (Covers Chapters 1 – 4)      (Answers)

Week 5

 

September

19, 21

 

Discounted Cash Flow Valuation

 

Exam 1 on

 September 21

Text: (RWJ) Reading: Chapter 5

Chapter 5 Lecture - Discounted Cash Flow Valuation   (PPT)

Resources: Summary of Annuity and Perpetuity Calculations

Websites: Discounted Cash Flow Calculator    

Videos: Calculating Present Value Extended     Using the PMT function in Excel to calculate loan payments     PMT, PPMT, IPMT in Excel

Exam 1 – September 21 (Covers Chapters 1 – 4)

Week 6

 

September

26, 28

Discounted Cash Flow Valuation Continued

Text: (RWJ) Reading: Chapters 5 and 6

Chapter 5 Lecture - Discounted Cash Flow Valuation   (PPT)     Perpetuities

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Assignment:  Text Chapter 5 - Questions and Problems: Questions 1, 2, 3, 4, 6, 14, 15     (Answers)    

Practice Problems Chapter 5 (Material will be on Exam 2)     (Answers) 

Week 7

 

October

3, 5

Interest Rates and

Bond Valuation

Text: (RWJ) Reading: Chapter 6

Chapter 6 Lecture - Interest Rates and Bond Valuation   (PPT)     Bond Practice

Resources: Summary of Bond Calculations

Websites: A.M. Best Ratings     Credit Rating Countries     FINRA Bond Quotes     Investopedia Bond Price Calculator    

Videos: Bond Pricing, Valuation, Formulas, and Functions in Excel (Does not use pull-down menus, but helpful)

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Assignment: Text Chapter 6 - Questions and Problems: Questions 1, 3, 6, 7, 9     (Answers)    

Practice Problems Chapter 6 (Material will be on Exam 2)     (Answers)

Week 8, Sunday Oct 10, 2020 – Thursday, Oct 14, 2021

Fall break, no classes

Week 9

 

October

17, 19

Equity Markets and Stock Valuation

Exam 2 on

October 19

Text: (RWJ) Reading: Chapter 7

Chapter 7 Lecture - Equity Markets and Stock Valuation   (PPT)

Exam 2 – October 19 (Covers Chapters 5 and 6)

Week 10

 

October

24, 26

Equity Markets and Stock Valuation

 

Net Present Value and Other Investment Decisions

Text: (RWJ) Reading: Chapters 7 and 8

Chapter 7 Lecture - Equity Markets and Stock Valuation   (PPT)

Chapter 8 Lecture - Net Present Value and Other Investment  (PPT)

Resources: Summary of Investment Criteria     Summary of Stock Valuation   

Videos:  Constant Growth Model     Stock Valuation 

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Assignment: Text Chapter 7 - Questions and Problems: QUESTIONS 4, 5, 13     (Answers)

Practice Problems Chapters 7 and 8 (Material will be on Exam 3)     

Week 11

 

October 31 November 2

Net Present Value and Other Investment Decisions Cont’d

 

Making Capital Investment decisions

Text: (RWJ) Reading: Chapters 8, 9 (Sections 9.1, 9.2, 9.6), and 10

Chapter 8 Lecture - Net Present Value and Other Investment  (PPT)

Chapter 9 Lecture - Making Capital Investment Decisions  (PPT)

Chapter 10 Lecture - Some Lessons from Capital Market History  (PPT)

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Text Chapter 8 - Questions and Problems: Questions 1, 5. 6, 8, 13     (Answers)

Practice Problems Chapters 7 and 8 (Material will be on Exam 3)   (Answers) 

Week 12

 

November

7, 9

Some Lessons from Capital Market History

 

Risk and Return

(RWJ) Reading: Chapters 10 and 11

Chapter 10 Lecture - Some Lessons from Capital Market History  (PPT)

Chapter 11 Lecture - Risk and Return  (PPT)     Estimating Beta

Websites: CAPM Calculator     Arithmetic versus Geometric Mean

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Assignment: Text Chapter 10 - Questions and Problems: QuestionS 1, 7     (Answers)

Practice Problems Chapters 9 and 10 (Material will be on Exam 3)     (Answers)

Assignment: Text Chapter 11 - Questions and Problems Homework: Questions 2, 3, 5, 13, 14, 15     (Answers)

Practice Problems Chapter 11 (Material will be on Exam 3)     (Answers)

Week 13

November

14, 16

Risk and Return Cont’d

Exam 3 on

November 16

(RWJ) Reading: Chapters 11 and 12

Chapter 11 Lecture - Risk and Return  (PPT)

Exam 3 – November 16 (Covers Chapters 7 -11)

 

Week 14

November

21, 23

 

The Cost of Capital Cont’d

 

Leverage and

Capital Structure

Text: (RWJ) Reading: Chapter 12 and 13 (Sections 13.1, 13.2, 13.3, 13.4)

Chapter 12 Lecture - The Cost of Capital  (PPT)

Chapter 13 Lecture - Leverage and Capital Structure   (PPT)

Websites: WACCExpert, ValuePro

Videos: Leverage     Operating Leverage

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Assignment: Text Chapter 12 - Questions and Problems: Questions 9, 10, 14     (Answers)

Practice Problems Chapters 12 and 13 (Material will be on the Final Exam)     (Answers)  

Week 15

 

November

28, 30

Leverage and Capital

Structure Cont’d

Text: (RWJ) Reading: Chapter 13 (Sections 13.1, 13.2, 13.3, 13.4)

Chapter 13 Lecture - Leverage and Capital Structure   (PPT)

Chapter 15 Lecture- Raising Capital   (PPT) – For your information – NOT on exam.

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Just concentrate on understanding the notes (No assignment)

Week 16

Final Exam

Exam Day and Time: