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MGMT 261 - Principles of Corporate Finance II
Course Code:
MGMT 261

Credits:
3

Calendar Description:
A continuation of MGMT 260, this course examines topics of: evaluation of risk vs. return trade-offs. determining the cost of capital, the capital structure question, dividend policy, cash, credit and inventory management.

Date First Offered:
2006-09-01

Hours:
Total Hours: 45
Lecture Hours: 45


Total Weeks:
15

This course is offered online:
No

Pre-Requisites:
One of Principles of Math 11, Foundations 11, Pre-Calculus 11 or MATH 040, and MGMT 103 Foundations of Financial Accounting 1, MGMT 109 Foundations of Financial Accounting II, MGMT 150 Business Mathematics, MGMT 260 Principles of Corporate Finance I.

Non-Course Pre-Requisites:
NONE

Co-Requisites:
NONE

Rearticulation Submission:
No

Course Content:
Week/Topic:

1 - Capital Market History
2 - Return, Risk & the Security Market Line
3 - Return, Risk & the SML cont'd
4 - Cost of Capital
5 - Cost of Capital cont'd
6 - Raising Capital, Review
7 - Reading Break
8 - MIDTERM EXAM
9 - Financial Leverage & Capital Structure Policy
10 - Dividends and Dividend Policy
11 - Short Term Finance & Planning
12 - Cash and Liquidity Management
13 - Credit and Inventory Management
14 - Review
15 - FINAL EXAM

Learning Outcomes:
Upon successful completion of this course, the student should be able to:

1. Explain the relationship between risk and return and the reduction of risk through diversification
2. Evaluate alternative forms of external financing; short-term, intermediate and long-term, in making capital structure decision.
3. Apply the principles of working capital management in relation to matching maturities, liquidity, inventory management, and business expansion.
4. Calculate and apply the correct cost of capital in business decision-making
5. Evaluate major capital spending decisions under conditions of uncertainty
6. Analyze the effect dividend policy has on the value of the firm
7. Evaluate cash, credit, and inventory management approaches

Grading System:
Letters

Passing Grade:
D (50%)

Grading Weight:
Final Exam: 40 %
Midterm Exam: 35 %
Assignments: 25 %


Percentage of Individual Work:
80

Percentage of Group Work:
20

Course Offered in Other Programs:
No

Keys to Success:
Attendance, Participation
a) Keeping current with reading
b) Developing a good attitude for learning.
c) Having a respectful approach with peers and the instructor
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