This course builds on the foundation developed in Finance I, focusing on three sets of managerial decisions:
- How to evaluate complex investments.
- How to set and execute financial policies within a firm.
- How to integrate the many financial decisions faced by firms.
The Finance II course is divided into four blocks of material:
- Tools of financial analysis (credit market analysis, option pricing, valuation of interest tax shields, weighted average cost of capital)
- Financial policy choices of firms (whether to finance with debt or equity, distributing cash to shareholders)
- Financial market imperfections (costs of financial distress, transaction costs, information asymmetries, taxes, agency conflicts)
- Deals and transactions (mergers and acquisitions, leveraged buyouts, hostile takeovers, initial public offerings)