Managerial Finance
Professor Nisan Langberg
Welcome
Nisan Langberg
nlangberg@uh.edu
Office 210E
Teaching Assistant
Eshwar (Buvaneshwaran Venugopal)
eshwar.gokul@gmail.com
Goal
Equip students with the basic tools necessary for
making efficient financial decisions while taking
into account future cash flows and their risk.
Methodology
Students will master the required theoretical
tools and apply them to day-to-day decision of
individuals (saving/retirement/mortgage…)
outline
• Logistics
• Course schedule
Logistics
Class Material
On our website
http://www.bauer.uh.edu/nlangberg/teaching_635.htm
Text book
I will teach and assign problems using the book
Corporate Finance by Jonathan Berk and Peter
DeMarzo, Perason
Alternative Reading
Further/alternative reading is Brealey, Myers and
Allen, Principals of Corporate Finance, McGraw-Hill
Irwin, 8th edition or higher
Buying the book?
I do recommend buying the book
• The course is built around the text book
• Excellent reference book for those to plan to
work in the area of corporate finance
• Taught in leading B schools around the world
Group Assignments
• I encourage work in groups
• Groups are limited to four students
Grade
• Homework assignments: 20%
• Quizzes: 20%
• Final exam: 60%
Office hours
• 5pm before class or by appointment
• welcome to stop by my office (210E)
• Send specific questions by email
Course Schedule
(tentative)
Course schedule
Wednesday and Thursday classes
August 26/27
September 3/4
Introduction
Time value of money
(chapters 3.1-3.3 and 4)
• Future value
• present value
• discounting stream of
cash flows
Time value of money
continued
• Annuities, perpetuities,
growing annuities and
growing perpetuities
• Saving for retirement
• Mortgage
Course schedule
September 9/10
Interest rates (chapter 5)
• APR, EAR, Amortizing loans
• Nominal and Real interest rates
• The Term Structure of Interest
Rates
Basics of Bond Valuation (chapter 6)
• Type of bonds
• Structure of bonds
• Valuation
Practice questions CH3,4 due
September 16/17
Review of Time value of
money with TA
• Review of basic discounting
principals
• Solution of homework
questions in class
• Additional advanced
practice questions
Quiz 1
Course schedule
September 23/24
Investment Decision Rules
(chapter 7)
• NPV, Payback period,
IRR, EVA
• Multiple investment
opportunities
• Resource constraints,
Profitability Index
Practice Questions CH5/6
due
September 30/October 1
Stock Valuation (chapter 9)
• Investing in stocks
• The Constant Dividend
Growth model
• The dividend and growth
tradeoff
• Changing growth rates
• Application: ebay
Practice questions CH7 due
Course schedule
(Additional class) October 3
9:00-12:00 (classroom TBD)
Pricing Risk (chapter 10)
• Risk and return
• Expected return, Volatility
• Calculating realized returns
• Excess returns
• Systematic and Idiosyncratic risk
• Diversification
• CAPM
October 7/8
Review of final
• Review of material
• sample exam
• Students’ questions
October 15/16
Final Exam
6:00-9:00
Questions before we start?