BRANDEIS INTERNATIONAL BUSINESS SCHOOL
BUS 71 A: INTRODUCTION TO FINANCE
REVISED 13/1/2016
SUBJECT TO SOME REVISIONS
Professor: Hamza Abdurezak, PhD., FRM
Office:
Sachar International Center, 124B
Email:
abdurez@brandeis.edu
Tel.
617-851-8406
Professor Office Hours: Thursdays from 3:00-5:00PM
Class Meeting Days & Times: Thursdays 6:30PM-9:20PM
Class Meets: TBA
Teaching Assistants:
•
Nihar Shendye: nihars@brandeis.edu
•
Yvonne Cao: yvcao@brandeis.edu
COURSE OBJECTIVES
The primary objective of this course is to develop the financial skills and thought processes
necessary to make and implement business decisions in a global environment. Upon successful
completion of this course, students will have developed an understanding of key concepts of the
financial environment within which management must operate, the processes of financial
analysis, the time value of money, methods of stock and bond valuation and the relationship of
valuation to risk and return.
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SPECIFIC LEARNING GOALS:


Develop fundamental understanding of
o The functions that financial market provide in the economy,
o How firms deal & use financial market to raise funds for their investments
o How investors and firms approach financial decisions
o Time value of money
o How firms make capital budgeting decisions
o Ethical Awareness in business decisions
Gain understanding and develop basic skill sets on
o how to value bonds and stocks
o Risk and return
o How companies raise capital and make capital structure and dividend policy
We will analyze how managers make financing and investment decisions within a framework
which emphasizes the time value of money and the relationship between expected return and risk
and examine alternative investment decision methods that financial managers use to evaluate
feasibility of undertaking new projects (i.e., capital budgeting)
Prerequisites: Bus 6a or equivalent. This course may not be taken for credit by students who
have previously taken Econ 171a. This course cannot be counted as an elective towards the
economics minor or major.
The Teaching Methods:
The teaching methods will involve combinations of class lectures and problem solving exercises
to digest concepts presented in the lecture and readings. This course is fast paced, reasonably
technical in nature, and it requires each student to do considerable out-of-class work. There is
assigned homework required for nearly every class session. Problem solving is very important in
this course and I encourage participation from all my students in this activity throughout the
term. This will be accomplished through assigned weekly problem sets on Connect, an online
platform that comes with the textbook with instant feedback. You should read the assigned book
chapters prior to coming to class. The material will mean a great deal more to you, and you will
understand and retain much more of it, especially when you review the class notes and problems
prior to an exam.
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COURSE REQUIREMENTS
Course materials

Primary Textbook::Essentials of Corporate Finance, 8th Edition, Ross, Westerfeld,
Jordan, (henceforth RWJ) McGraw-Hill, 2013. ONLINE EDITION IS REQUIRED!
We will use CONNECT, an online platform that comes with book to do assigned
problem set and exercises. The online edition and CONNET platform are bundled
together are cheaper than buying the hard copy of the book and separately buying
CONNECT.

Additional course materials will be posted on LATTE and/or distributed in class.

Regular readings of financial and business press such as Financial Times, Barron’s, and
the Economist may help students appreciate the applications of the principles developed
throughout the semester. A very important benefit of keeping up with current business
events is that it may provide students some ammunition with which you can impress
career job interviewers, From time to time, I will comment on relevant topics that appear
on financial press.
Workload expectation

As BUS 71a is a four-credit course, you are expected to spend a minimum of 9 hours of
study time per week in preparation for class (readings, problems sets, discussion
sections, preparation for exams, case studies, etc.).
Homework Problem Sets: The best way to learn finance is by doing series of problem sets to
digest the concepts developed in class lectures and textbook readings. I will assign practice
problem sets throughout the semester. Homework is generally submitted electronically via the
CONNECT electronic interface with the electronic textbook. In all sections of BUS 71a we will
follow the following homework grading procedure for consistency across sections.

Check plus: flawless/near-flawless
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
Check / Check plus: most work done correctly, but 1-2 significant errors

Check: Student showed effort, but made several significant errors

Check minus: not turned in, turned in with significant help from another student (e.g.,
“cheating”) or no meaningful effort made.

It is absolutely critical that you work on these problem sets by yourself to gain the benefit
of their intended objectives of digesting the concepts and principles. In addition, these
problem sets are study tools for the midterm and final exams since the exam questions are
closely modelled around those questions although I will not repeat the same questions for
the exams except the concept covered by those questions. Students who consistently do
well on these problem sets tend to do well on the exams as well.. Therefore, the most
important and most helpful suggestion I can give you for doing well in this course is to
do all the assigned questions and problems and then review them so that you are able to
do them on the exam. The surest way to do poorly in this course is to not carefully work
on these homework assignments. If you have any difficulty in solving the problems,
please contact me and my TAs assigned for this course.

Financial Calculator: Students will be REQUIRED to use a TI BAII Plus financial
calculator. NO OTHER FINANCIAL CALCULATOR IS TO BE USED! Please read
pages 103-104 and 620-622 in the text book if you need help with a financial calculator.
You should bring the calculator to every class. I am fine with you using Excel as a tool
for homework, but you will not have it available to you during exams, so it’s important to
be very familiar with the financial calculator functions.
Class Participation: I expect you to actively participate in class discussion and problem solving
throughout the semester, We will take class attendance every class. Class participation grade
will be on a similar scale to homework grades:

Check-plus: 2 or more contributions (questions or responses) to a given class session’s
discussion

Check/Check-plus: 1 contribution to a given class session’s discussion

Check: attendance, but no contribution

Check minus: unexcused absence. I will provide excused absences to varsity athletes for
scheduled competitions. Those must be arranged in advance. I allow students one
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unexcused absence per term without penalty. Additional absences will deduct from your
class participation score.
To facilitate participation, I will ask all students to place a name card on their desks, and that
they sit in the same seat every class. Perfect attendance but no participation receives a grade of
“B-“ towards the overall grade. Each unexcused absence results in a reduction in this grading
element. It is your responsibility to ensure that you take an active role in the class. If this is
a problem for you, I urge you to talk to me to discuss ways you can make a contribution.
Grading

Class Participation
15%

Assignments ( Connect Problem Sets)
25%

Midterm Exam
20%

Final Exam
40%
The midterm will be for the full class duration, and the final will be a 3 hour exam. The final
exam is comprehensive and cumulative. There will be no makeup exam for the midterm.
Students with an excused absence from the midterm will split its weight equally between
homework assignments and the final exam. You cannot skip the final exam – if you do you will
get zero for the final – the weight from the final will not be moved to the other components. The
final exam is available only during the specified exam schedule time, time to be determined by
registrar.
Both the midterm and final exams are closed books and closed notes. However, you may bring
one crib sheet to the midterm exam and two crib sheets to the final exam. A crib sheet is an
ordinary (A4 or 8 ½” x 11”) piece of paper, on which you may write, type, print or copy
formulas ONLY- no definitions or any other text will be allowed. Writing should be in 10 point
font or hand-written equivalent and you may use both sides of the paper. You may not staple or
tape any extensions or booklets onto the crib sheet. Do not abuse this privilege – if you do
there will be severe penalties on your final grade.
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Academic honesty: You are expected to be honest in all of your academic work. Please
consult Brandeis University Rights and Responsibilities for all policies and procedures
related to academic integrity. Students may be required to submit work to TurnItIn.com
software to verify originality. Allegations of alleged academic dishonesty will be forwarded
to the Director of Academic Integrity. Sanctions for academic dishonesty can include
failing grades and/or suspension from the university. Citation and research assistance can
be found at LTS - Library guides
Special Accommodation. If you are a student with a documented disability on record at
Brandeis and wish to have a reasonable accommodation made for you in this class, please see me
immediately. Please keep in mind that reasonable accommodations are not provided
retroactively.
Use of Laptop Computers and Cell Phones in Class:
Cell phones and PDA.s (i.e., Blackberrys, iPhones, etc.) must be turned off during lectures.
Laptops may be used only to take notes. Regular class attendance is mandatory and strongly
advised if you want to do well in the course. I stick quite closely to my slides and what I discuss
in class when setting exam questions. Laptop computers and cellphones may not be used during
exams.
Course Calendar & Outline
Date
Topics
Assigned
Readings
RWJ
1/14



1/21

1/28

Course Overview and
Introduction
Introduction to Financial
Management
Financial Statements and Cash
Flow
Working with Financial
Statements
Chapter 1
Time Value of Money
Chapter 4
Chapter 2
Chapter 3
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2/4

Discounted Cash Flow
Valuation
Chapters 5
2/11

Interest Rates and Bond
Valuation
Chapter 6
Monday, Feb.
15 – Friday,
Feb. 19
2/25
Midterm Recess: No university
exercises.

Equity Markets and Stock
Valuation
Chapter 7
MIDTERM EXAM
3/3
3/10

Net Present Value and Other
alternative Investment
Decision Methods
Chapter 8
3/17

Project Cash Flow Analysis &
Making Investment Decisions
Chapter 9
3/24

3/31



Chapter 10
Some Lessons from Capital
History
Introduction to Risk & Return
Chapter 11
Risk & Return
Diversification, systematic and
unsystematic risk
4/7


Cost of Capital Estimation
Leverage and Capital
Structure
Chapter 12
Chapter 13
7
4/14


4/21
Friday, April 22
– Friday, Apr.
29
From May 5 –
Through May
12

Dividend Policy- First half
class
Course Review & SummarySecond half class
Chapter 14
No Class- Brandeis Friday
Class Meets on this day
Passover &
Spring Recess:
No university
exercises
Exam Period
Exam Date will
be according to
the registrar’s
schedule
Note: I reserves the right to add and remove readings from the course and to alter or modify the
lecture schedule as required. I will give you advance notice of any such changes or
modifications.
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