Introduction to Finance

Type of CourseLecture and exercise course
TermWinter term 2017/18
Credits6


Dates/Times/Locations
Thursday, 14:15-15:45, weekly: 19.10.2017 to 01.02.2018
Room: ZHG - ZHG010


Exams
Saturday, 12:00-13:30, Exam: 17.02.2018
Monday, 11:00-12:30, Exam: 26.03.2018


Instructors
Muntermann, Jan, Prof. Dr.
Wieneke, Runhild, M.Sc.


Learning outcome / core skills:

After successfully completing this module, students should be able to:

  • understand and being able to explain the different functions of corporate finance within a firm according to the traditional and modern views.
  • explain and correctly apply the basic terminology of corporate finance.
  • explain and critically reflect the economic foundations of investment theory.
  • explain and apply major methods and criteria for investment evaluation (net present value methods, future value method, annuity method, internal rate of return, pay-back method).
  • put structure to decision problems under uncertainty.
  • explain and distinguish between different forms of financing and be able to critically assess their potential strengths and weaknesses.
  • explain the concepts of cost of capital and leverage and be able to illustrate their importance for corporate finance.

  

Course:

1. Introduction to Finance (lecture)

Contents:

  1. The traditional view on corporate finance
  2. The modern view on corporate finance
  3. Foundations of investments
  4. Capital budgeting and investment criteria
  5. Decision problems under uncertainty
  6. The cost of capital for equity and debt
  7. Capital structure and the cost of capital

2. Introduction to Finance (tutorial)

Contents:

  • In accompanying tutorials students deepen and extend their knowledge and skills.

Examination

Examination: Written examination (90 minutes)

  

Examination requirements:

  • Knowledge of the role and function of corporate finance according to the traditional and modern views. 
  • Knowledge of the basic terminology of corporate finance and ability to apply this terminology correctly.
  • Knowledge of the economic foundations of investment theory. 
  • Ability to describe, differentiate between, and correctly apply the major investment criteria. 
  • Show understanding of the basic concepts to structure and solve decision problems under uncertainty. 
  • Ability to describe and differentiate between different forms of financing and to assess their advantages and disadvantages. 
  • Knowledge of the concepts of cost of capital and leverage and ability to explain their importance.