04521 - Corporate finance

Learning outcomes

The aim of this course is to provide the students with a set of analytical tools and techniques necessary to explore the most important investment and financing decisions taken by firms at different stages of their life cycle. At the end of the course the student will be able to: - select the best business investment strategies a firm should undertake; - calculate and interpret the company’s cost of capital; - identify the main financing sources available to companies.

Course contents

Module I

• The Role of Corporate Finance in Corporations
  
• Maximizing Shareholder Value as a Company Objective
• Financial Analysis and Financial Planning
• Principles of Mathematical Finance
• Evaluation of Bonds and Shares
• Investment Assessment Methods
• Risk-Return Relationship

Module II

• Estimating the Opportunity Cost of Capital through the Capital Asset Pricing Model (CAPM)
• Financing Decisions
• Risk Capital Financing: Venture Capital and Initial Public Offerings (IPO)
• Seasoned Equity Offerings
• Dividend Policy

Readings/Bibliography

• Lecture notes. The notes will be available on the platform “virtuale.unibo.it”.
• Book: R. Brealey, S. Myers, F. Allen, S. Sandri, Principi di Finanza Aziendale , McGraw Hill Libri Italia, 2020. Chapters 1-3, 5-10, 12-19 (ISBN: 8838695717 · 9788838695711). As attending the course is not mandatory, there is no difference between attending and non-attending students.
• Module I: Chapters 1-3 e 5-8
• Module II: Chapters 9-10 e 12-19
• Some suggestions for the exercises: E. Bajo, M. Barbi, S. Sandri, Esercizi di Finanza Aziendale, Apogeo, 2017

Teaching methods

The program will be presented in class. Both theoretical and practical classes will be provided. Practical classes, comprising four sessions for each module, will focus on the resolution of exercises and the presentation of case studies.

Assessment methods

• Valuation is based on a written exam, consisting of multiple-choice questions.
  
• First Partial Exam: Typically held at the end of October or beginning of November.
• Second Partial Exam: Held in January.
• Each partial exam includes 16 multiple-choice questions worth 32 points. The duration of each partial exam is 40 minutes. To qualify for the second partial exam in January, a minimum score of 14 points is required in the first partial exam.
• Total Exam: The total exam consists of 32 multiple-choice questions, with 16 questions from each module. The total duration of the exam is 80 minutes. Each module accounts for 50% of the total score.
• Each correct answer awards 2 points. There is no penalty for incorrect answers, and each question has only one correct answer.
  
• Students are permitted to use notes and books during the exam.
• The course is taught during the first semester. There will be two exam sessions in the winter period (January-February). The second partial exam and the first total exam are scheduled for the same day. An additional exam session will be held in September. A special exam session can be arranged in the second half of July upon the request of at least one student.
  
  
• Grading Scale
• Minimum Grade: 18
• Maximum Grade: 30L
• 18-23: Sufficient preparation and analytical skills on a limited number of topics covered in the course.
• 24-27: Adequate preparation and analytical skills with some limitations; good operational skills, though not particularly articulated.
• 28-30: Very good knowledge of a wide range of topics covered in the course; strong operational and critical skills.
• 30L: Excellent and comprehensive knowledge of the course topics; exceptional critical analysis and ability to make connections.

Teaching tools

Blackboard, spreadsheets, tablet

Office hours

See the website of Pierpaolo Pattitoni