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Thammasat Business School, Thammasat University, 2 Prachan Road,
Bangkok 10200, Thailand Tel: (66) 2613-2246, (66) 2225-2114
Fax: (66) 2225-2114 URL: http://www.mif.bus.tu.ac.th E-mail: [email protected]
Thammasat Business School – Thammasat University
Course Syllabus
Semester/ Academic Year: 1st / 2014 (MIF# 16)
MF641 Corporate Finance Theory
Course Description
This course explores the core theoretical aspects of modern corporate finance which is grounded in the
unifying valuation framework based on the Law of One Price. The course examines essential tools in
corporate finance from the perspective of financial managers of a corporation for making good investment
and financing decisions. Topics covered include financial decision making and the Law of One Price,
time value of money and valuing financial securities, capital budgeting, pricing of risk and estimating the
cost of capital, capital structure in perfect capital markets (Modigliani-Miller propositions), capital
structure with market imperfections, and payout policy. The course also provides an overview of the latest
developments in corporate finance research.
Objectives
1. To develop theoretical foundations of modern corporate finance.
2. To develop a good understanding of the key empirical research in corporate finance.
Instructor
Pramuan Bunkanwanicha, Ph.D.
Professor of Finance
ESCP Europe, Paris, France
Email: [email protected]
Course Material
The required text book for the course is:
Berk, Jonathan and Peter DeMarzo, Corporate Finance, 3rd global edition, Pearson, 2013
The textbook should be purchased with the option to access the web materials (MyFinanceLab). The
contents of the course are essentially corresponding to Chapter 1 – 17 of the text book. Additional lecture
notes and problem sets will be distributed in class. The reading list of research articles will be provided.
1
Grading
Assignments/Participation
Mid-term Exam
Final Exam
20%
30%
50%
Tentative Schedule 1
Session
1
Date
Sat. July 19
Topic
Readings
Introduction
Berk & DeMarzo Ch.1-2
Financial Decision Making and the
2
Sat. July 19
Law of One Price/ Time Value of
Berk & DeMarzo Ch.3-4
Money
3
Sun. July 20
Interest Rates and Valuing Bond
Berk & DeMarzo Ch.5-6
4
Sun. July 20
Investment Decision Rules
Berk & DeMarzo Ch.7
5
Thu. July 24
Capital Budgeting/ Valuing Stocks
Berk & DeMarzo Ch.8-9
6
Fri, July 25
7
Sat. July 26
Estimating Cost of Capital
8
Wed. July 30
Mid-term
9
Thu. July 31
10
Fri. August 1
Capital Structure in a Perfect Market
Berk & DeMarzo Ch.14
11
Sat. August 2
Debt and Taxes
Berk & DeMarzo Ch.15
12
Sat. August 2
13
Mon. August 4
Payout Policy
Berk & DeMarzo Ch.17
14
Thu. August 7
Empirical Corporate Finance (Part I)
Research articles
15
16
1
Risk and Return/ Optimal Portfolio
Choice/ Capital Asset Pricing Model
Berk & DeMarzo Ch.10-11
Berk & DeMarzo Ch.12
Investor Behavior and Capital Market
Efficiency
Financial Distress, Managerial
Incentives, and Information
Berk & DeMarzo Ch.13
Berk & DeMarzo Ch.16
Empirical Corporate Finance (Part II) Research articles
Sun. August 17
Final exam
The schedule is subject to change at the instructor’s discretion.
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