International MSc in Business Administration
Corporate Finance
Fall 2013
Guilherme Almeida e Brito, Mário Meira
Syllabus
Instructors: Guilherme Almeida e Brito holds a Ph.D. in Finance from New York University, a
MBA from NYU and a Licenciatura in Business Administration from FCEE-Católica. He is
Senior Associate Dean at Católica-Lisbon and the MSc Academic Director. He was the MBA
Academic Director 1999-2008. His main areas of academic activity include capital budgeting,
financing decisions and security design. He has presented his research at several international
Finance conferences. He is a consultant for the Center of Applied Studies and he has developed
some entrepreneurial activities.
Mário Meira holds a M.Sc in Economics from Católica-Lisbon Shcool of Business and
Economics and a Undergraduate degree in Economics from Católica-Porto School of Business
and Economics. He is currently enrolled in the Ph.D. program in Economics in Nova School of
Business and Economics. In his previous professional experience he has worked as a consultant
for institutions like the Portuguese Banking Association and Maksen.
Contacts: gbrito@ucp.pt, mhm@clsbe.lisboa.ucp.pt
COURSE AIMS
The main goal of the Finanças Empresariais course is to engage you in a journey to discover the
main financial concepts and methods. We adopt the perspective of a financial manager of a
non-financial firm. This course contributes to understand financial markets, financial
investments and corporate finance decisions.
LEARNING OBJECTIVES
At the end of the course you should be able to:
Value investment projects.
Understand basic valuation of bonds, stocks and options.
Understand the relationship between risk and return.
Understand the relationship between capital structure and the cost of capital.
TEACHING AND LEARNING METHODS
This is a demanding quantitative course. You are expected to acquire a clear understanding of
financial concepts and great familiarity with financial techniques.
The course requires careful reading of the textbook and extensive time for exercises. Please do
so every week and your experience will be greatly enhanced.
ASSESSMENT
Mini-test: 10%, Midterm Exam: 40%, Final Exam: 45%, Written Assignments + Class
Participation: 5%
COURSE CONTENT
Week
Subject
Mandatory reading
1, 2
Present Values.
BMM chap. 1, 2, 5; BMA, chap. 1, 2
2, 3
Asset Valuation: Bonds.
BMM chap. 6; BMA, chap. 3
4, 5
Asset Valuation: Stocks.
BMM chap. 7; BMA, chap. 4
6, 7
Project Valuation.
BMM chap. 8, 9, 10; BMA, chap. 5, 6
8
Risk and Return. Portfolio Theory.
BMM chap. 11, 12; BMA, chap. 7, 8
9
Risk and Return. CAPM.
BMM chap. 111, 12; BMA, chap. 7, 8, 9
10
Cost of Capital: Financial Leverage, MM.
BMM chap. 16; BMA, chap. 9, 10, 17
11
Cost of Capital: WACC.
BMM chap. 13; BMA, chap. 19
12
Asset Valuation: Derivatives.
BMM chap. 23; BMA, chap. 20, 21
BIBLIOGRAPHY
Required textbook: Brealey, Myers & Allen (BMA), “Principles of Corporate Finance”, 10th
edition, McGraw-Hill (previous editions are also acceptable).
You may use instead an alternative textbook:, Ross, Westerfield, Jaffe & Jordan, “Modern
Financial Management”, or Ross, Westerfield and Jaffe, “Corporate Finance”. Students with
weaker analytical skills may prefer to use instead a more introductory textbook: Brealey, Myers
& Marcus (BMM), “Fundamentals of Corporate Finance”, 7th edition, McGraw-Hill, 2012
(previous editions are also acceptable).