- Understand what finance theory says about how risky securities are priced in equilibrium.
- Understand what finance theory has to say about the mix between debt and equity finance for a firm.
- Understand the implications of the previously mentioned points for risky investment valuation.
- Understand dividends: Why do firms pay dividends? Do investors demand dividends? Should dividends matter for the firm or the investor?
- Learn about derivatives and their use as risk management tools by firms and investors.

The course deals with basic issues in finance, such as risk diversification and asset pricing, capital structure, investment valuation, market efficiency, dividend policy and the use of derivatives.

Berk & De Marzo, Corporate Finance, Pearson

This course is in transition for the bachelor Fiscal Economics.
See the Bachelor Education and Examination Regulations for more information.

The following rule applies to bachelor Fiscal Economics students.
TRANSITIONAL REGULATION (EBC2006):
The bachelor Fiscal Economics has been discontinued.

There will be repeat education for year 1 and year 2 courses up to and including academic year 2025-2026 and exam-only up to and including academic year 2026-2027. For year 3 courses there will be repeat education up to and including 2026-2027 and exam-only up to and including academic year 2027-2028.

Whether a course is in transition, cancelled, or replaced may depend on the cohort you are in. Sometimes there are additional criteria. It is therefore very important to carefully read the EER and the addendum so you can apply the rules to your individual situation.


PREREQUISITES:
* Students are expected to understand the following finance concepts: Types of securities (stocks, bonds) and their returns; the concept of risk diversification and efficient frontiers, principles of time value of money.
* Exchange students need to have taken at least one introductory finance course.
* An advanced level of English.