Fundamentals of Corporate Finance

Fundamentals of Corporate Finance

7th Edition | See Newer Edition

By Richard Brealey and Stewart Myers and Alan Marcus

  • Copyright: 2012

  • Publication Date: September 14, 2011

  • ISBN 10: 0078034647

  • ISBN 13: 9780078034640

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Fundamentals of Corporate Finance, by Brealey, Myers and Marcus, provides students with a solid framework of theory and application to use well after they complete the course. This author team is known for their outstanding research, teaching efforts, and world-renowned finance textbooks, so it's no surprise that they provide clear exposition of difficult material without sacrificing up-to-date, technically correct treatments. The seventh edition has been fully updated to reflect recent events and is now available with Connect Finance!

Connect is the only integrated learning system that empowers students by continuously adapting to deliver precisely what they need, when they need it, and how they need it, so that your class time is more engaging and effective.

  • Language: English

  • Imprint: Irwin/McGraw-Hill

  • Dimension: 8.7 x 11.2 IN

  • Page Count: 784

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Part One Introduction

1 Goals and Governance of the Firm

2 Financial Markets and Institutions

3 Accounting and Finance

4 Measuring Corporate Performance

Part Two Value <

Table of Contents

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Part One Introduction

1 Goals and Governance of the Firm

2 Financial Markets and Institutions

3 Accounting and Finance

4 Measuring Corporate Performance

Part Two Value

5 The Time Value of Money

6 Valuing Bonds

7 Valuing Stocks

8 Net Present Value and Other Investment Criteria

9 Using Discounted Cash-Flow Analysis to Make Investment Decisions

10 Project Analysis

Part Three Risk

11 Introduction to Risk, Return, and the Opportunity Cost of Capital

12 Risk, Return, and Capital Budgeting

13 The Weighted-Average Cost of Capital and Company Valuation

Part Four Financing

14 Introduction to Corporate Financing

15 How Corporations Raise Venture Capital and Issue Securities

Part Five Debt and Payout Policy

16 Debt Policy

17 Payout Policy

Part Six Financial Analysis and Planning

18 Long-Term Financial Planning

19 Short-Term Financial Planning

20 Working Capital Management

Part Seven Special Topics

21 Mergers, Acquisitions, and Corporate Control

22 International Financial Management

23 Options

24 Risk Management

Part Eight Conclusion

25 What We Do and Do Not Know about Finance

Appendix A

Appendix B

Glossary

Credits

Global Index

Index

New Features

  • McGraw-Hill’s Connect Finance offers a number of powerful tools and features to make managing assignments easier and the learning process more accessible and efficient.
    • Create and deliver online, auto-graded homework assignments, quizzes, and tests directly from the end-of-chapter materials or test bank.
    • A Self Quiz and Study program allows students to evaluate their performance through a practice test and then receive recommendations for specific readings from the text, supplemental study material, and practice work that will improve their mastery of each learning objective.
    • Prep Courses for Math, Statistics, Accounting, and Economics are comprised of animated tutorial modules with quiz questions to get students up to speed on the basics.
    • Questions mapped to AACSB skill areas, Bloom’s Taxonomy levels, and difficulty level enable you to run reports that assess specific learning outcomes.
  • Connect Finance. This packaging option combines all the great features of Connect Finance, along with access to an online version of Fundamentals of Corporate Finance, linked to additional study features, so that students can easily refer back to the text for review and guidance.
  • Updated Topic Coverage:
    • To reflect the increased attention on agency theory and behavioral finance, the material on efficient markets in Chapter 7 (Valuing Stocks) now includes a section on price bubbles as well as a discussion of behavioral biases. Other topics that receive increased emphasis include company valuation, real options, and stock repurchases.
    • There are plenty of references in this edition to the crisis of 2007-2009 and its impact on financial managers, and there are also many less dramatic examples of recent changes in the financial landscape. For example, Chapter 3 (Accounting and Finance) includes a discussion of SOX, of mark-to-market accounting, and of recent developments in international accounting standards.
    • All statistics have been updated when appropriate, including measures of EVA, data on security ownership, bond yields, and dividend and repurchase payouts.
  • Improved Flow:
  • Chapter 4 emphasises how financial ratios are used in measuring the value management has added to a firm. This context prevents the chapter from becoming a tedious list of ratios. This introduction prevents the chapter from becoming a tedious list of ratios.
  • The discussion of the internal rate of return and its pitfalls in Chapter 8 (Net Present Value and Other Investment Criteria) has been reworked to make the discussion of IRR flow more easily.
  • Spreadsheet Solutions Boxes demonstrate how students may use Microsoft Excel to perform useful financial calculations demonstrate how students may use Microsoft Excel to perform useful financial calculations. Questions have been added at the end of each box so students can perform their own similar analysis to make sure they understand the concept. Students who need assistance in using Microsoft Excel can refer to the student side of the Online Learning Center that contains a detailed Excel tutorial with spreadsheet templates.
  • Key Features

    • Includes an important discussion of ethical issues facing financial managers. This content is more important than ever given the recent corporate scandals that have impacted investor confidence, financial markets and the economy as a whole.
    • Excellent end of chapter material is a hallmark of this text. The problems are designated by learning objective, degree of difficulty as quizzes, practice problems, and challenge problems. This range gives instructors significant flexibility when assigning homework.
    • Financial Calculator Boxes help students use a financial calculator to solve finance problems. These appear close to the spreadsheets to show both ways of solving problems.
    • Mini-Cases appear in select chapters, and have specific questions that follow each case. This popular feature helps students apply finance theory to real-world situations.
    • Numbered Examples are integrated into each chapter. Students can learn how to solve problems step-by-step as well as gain insight into general principles by seeing how they are applied to answer concrete questions and scenarios.

    Features

    x

    New Features

    • McGraw-Hill’s Connect Finance offers a number of powerful tools and features to make managing assignments easier and the learning process more accessible and efficient.
      • Create and deliver online, auto-graded homework assignments, quizzes, and tests directly from the end-of-chapter materials or test bank.
      • A Self Quiz and Study program allows students to evaluate their performance through a practice test and then receive recommendations for specific readings from the text, supplemental study material, and practice work that will improve their mastery of each learning objective.
      • Prep Courses for Math, Statistics, Accounting, and Economics are comprised of animated tutorial modules with quiz questions to get students up to speed on the basics.
      • Questions mapped to AACSB skill areas, Bloom’s Taxonomy levels, and difficulty level enable you to run reports that assess specific learning outcomes.
    • Connect Finance. This packaging option combines all the great features of Connect Finance, along with access to an online version of Fundamentals of Corporate Finance, linked to additional study features, so that students can easily refer back to the text for review and guidance.
    • Updated Topic Coverage:
      • To reflect the increased attention on agency theory and behavioral finance, the material on efficient markets in Chapter 7 (Valuing Stocks) now includes a section on price bubbles as well as a discussion of behavioral biases. Other topics that receive increased emphasis include company valuation, real options, and stock repurchases.
      • There are plenty of references in this edition to the crisis of 2007-2009 and its impact on financial managers, and there are also many less dramatic examples of recent changes in the financial landscape. For example, Chapter 3 (Accounting and Finance) includes a discussion of SOX, of mark-to-market accounting, and of recent developments in international accounting standards.
      • All statistics have been updated when appropriate, including measures of EVA, data on security ownership, bond yields, and dividend and repurchase payouts.
    • Improved Flow:
    • Chapter 4 emphasises how financial ratios are used in measuring the value management has added to a firm. This context prevents the chapter from becoming a tedious list of ratios. This introduction prevents the chapter from becoming a tedious list of ratios.
    • The discussion of the internal rate of return and its pitfalls in Chapter 8 (Net Present Value and Other Investment Criteria) has been reworked to make the discussion of IRR flow more easily.
  • Spreadsheet Solutions Boxes demonstrate how students may use Microsoft Excel to perform useful financial calculations demonstrate how students may use Microsoft Excel to perform useful financial calculations. Questions have been added at the end of each box so students can perform their own similar analysis to make sure they understand the concept. Students who need assistance in using Microsoft Excel can refer to the student side of the Online Learning Center that contains a detailed Excel tutorial with spreadsheet templates.
  • Key Features

    • Includes an important discussion of ethical issues facing financial managers. This content is more important than ever given the recent corporate scandals that have impacted investor confidence, financial markets and the economy as a whole.
    • Excellent end of chapter material is a hallmark of this text. The problems are designated by learning objective, degree of difficulty as quizzes, practice problems, and challenge problems. This range gives instructors significant flexibility when assigning homework.
    • Financial Calculator Boxes help students use a financial calculator to solve finance problems. These appear close to the spreadsheets to show both ways of solving problems.
    • Mini-Cases appear in select chapters, and have specific questions that follow each case. This popular feature helps students apply finance theory to real-world situations.
    • Numbered Examples are integrated into each chapter. Students can learn how to solve problems step-by-step as well as gain insight into general principles by seeing how they are applied to answer concrete questions and scenarios.

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    About the Authors

    Richard Brealey

    Richard A. Brealey is a Professor of Finance at the London Business School. He is the former president of the European Finance Association and a former director of the American Finance Association. He is a fellow of the British Academy and has served as a special adviser to the Governor of the Bank of England and as director of a number of financial institutions. Professor Brealey is also the author (with Professor Myers) of this book’s sister text, Principles of Corporate Finance.

    Stewart Myers

    Stewart C. Myers is the Gordon Y Billard Professor of Finance at MIT’s Sloan School of Management. He is past president of the American Finance Association and a research associate of the National Bureau of Economic Research. His research has focused on financing decisions, valuation methods, the cost of capital, and financial aspects of government regulation of business. Dr. Myers is a director of The Brattle Group, Inc., and is active as a financial consultant. He is also the author (with Professor Brealey) of this book’s sister text, Principles of Corporate Finance.

    Alan Marcus

    Alan J. Marcus is a Professor of Finance in the Wallace E. Carroll School of Management at Boston College. His main research interests are in derivatives and securities markets. He is co-author (with Zvi Bodie and Alex Kane) of the texts Investments and Essentials of Investments. Professor Marcus has served as a research fellow at the National Bureau of Economic Research. Professor Marcus also spent two years at Freddie Mac, where he helped to develop mortgage pricing and credit risk models. He currently serves on the Research Foundation Advisory Board of the CFA Institute.