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FINN2041: Corporate Finance

Please ensure you check the module availability box for each module outline, as not all modules will run in each academic year. Each module description relates to the year indicated in the module availability box, and this may change from year to year, due to, for example: changing staff expertise, disciplinary developments, the requirements of external bodies and partners, and student feedback. Current modules are subject to change in light of the ongoing disruption caused by Covid-19.

Type Tied
Level 2
Credits 20
Availability Available in 2023/24
Module Cap None.
Location Durham
Department Finance

Prerequisites

  • Foundations of Finance (FINN1011)

Corequisites

  • None

Excluded Combinations of Modules

  • None

Aims

  • Provide students with theoretical knowledge and practical understanding of key theories in finance and corporate policy decisions by building on and developing the knowledge and skills acquired at Level 1.
  • To provide students with a good grounding for undertaking a dissertation in the finance field.
  • Familiarise students with selected empirical issues and methods of analysis of corporate financial decisions within the broader framework of financial theories.

Content

  • The following is indicative of the types of area to be covered:
  • Asymmetric information, agency theory and corporate governance.
  • Measures of risk, mean variance analysis and portfolio theory.
  • The Capital Asset Pricing Model (CAPM), its extensions and Arbitrage Pricing Theory (APT).
  • Corporate Valuation: Present Value Models (Free Cash Flow Valuation) and Multiplier Models (Enterprise Valuation).
  • Long term equity financing.
  • Capital Structure and the cost of capital: Theory and empirical evidence.
  • Real option analysis.
  • Dividend policy: Theory and empirical evidence.
  • Mergers, Acquisitions and Corporate Control.

Learning Outcomes

Subject-specific Knowledge:

  • Have knowledge and understanding of essential principles of Corporate Finance.

Subject-specific Skills:

  • Be able to use principles of Corporate Finance to analyse financial issues.

Key Skills:

  • Written Communication - through summative assessment.
  • Planning, Organisation and Time Management - e.g. by preparing for examinations.
  • Problem Solving and Analysis - e.g. by applying the necessary analytical and quantitative skills, as well as the ability to manipulate concepts in corporate finance, in undertaking assessed work.
  • Numeracy - e.g. by applying core mathematical and statistical skills to answer a range of class and examination questions

Modes of Teaching, Learning and Assessment and how these contribute to the learning outcomes of the module

  • Teaching is by lectures and seminars. Learning takes place through attendance at lectures, preparation for and participation in tutorial classes, and private study.
  • Formative assessment is by means of an online test.
  • Summative assessment is by means of an online test and an online open book examination (2 hours lone) to be taken over a 24-hour window.

Teaching Methods and Learning Hours

ActivityNumberFrequencyDurationTotalMonitored
Lectures201 per week1 hr20 
Revision Lectures21 per week1 hr2 
Seminars8Fortnightly1 hr8 
Preparation and Reading170 
Total200 

Summative Assessment

Component: Online TestComponent Weighting: 30%
ElementLength / DurationElement WeightingResit Opportunity
Online Test1.5 hours100same
Component: ExaminationComponent Weighting: 70%
ElementLength / DurationElement WeightingResit Opportunity
Online examination2 hours, 3000 words max100same

Formative Assessment

Online test which will consist of multiple choice questions, no longer than 1.5 hours in duration.

More information

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