Pre-requisites: Entry requirements of the MBA, including three years' work experience. Good quantitative skills. Basic computer skills
Aims/Description: This module focuses on the principles underlying financial decision making. Finance directors make two major types of decisions, investment decisions and decisions on how to finance investment projects. Concerning investment decisions, the module reviews the determination of the cost of capital under uncertainty based on the Capital Asset Pricing Model (CAPM). In terms of financing decisions, the link between shareholder value on one side and financing choices (debt versus equity financing) and dividend policy on the other side is examined. The module also discusses the motives behind mergers and acquisitions as well as the potential and actual gains from such operations for both the bidder and target firms. Finally, the traditional approach to finance which assumes that securities are in general fairly priced is contrasted with a more recent approach which argues that psychological effects systematically bias investor behaviour and therefore cause persistent mispricings.
Restrictions on availability: Only available to MBA students.
Information on the department responsible for this unit (Management School):
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Teaching methods and assessment displayed on this page are indicative for 2021-22. Students will be informed by the academic department of any changes made necessary by the ongoing pandemic.