fmp201112_intro - Financial Financial Management and Policy...

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inancial Management and Policy Financial Management and Policy lock EBC2055 Block EBC2055 Year 2011-12 Coordinator Georges Hübner Tutors Sajid Chaudhry (groups 3, 4, 6) atie Dinh (groups 5 7 8) Katie Dinh (groups 5, 7, 8) Georges Hübner (groups 1 (Marble), 2) Carl Vandenboorn (groups 9, 10, 11) 0 - 1
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inancial Management and Policy Financial Management and Policy ourse introduction: 1. Course introduction: ` The game ` The goal ` The rules 2. Course organization ` The concept ` The material ` The meetings he evaluation ` The evaluation 0 - 2
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The game FIRM MARKET Investments Securities $ (price of securities P) Risk Discounting eturns Returns $ (cash flows CF t ) Income 0 - 3
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The goal Shareholder FIRM MARKET Hires Perfo Securities $ (price of securities P) FO Investments Discounting CFO Risk come Returns $ (cash flows CF t ) Income 0 - 4
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The rules Shareholder FIRM MARKET Hires Perfo Securities $ (price of securities P) FO Investments iscounting P = V(CF t , time, risk) CFO Risk come Discounting + f (info) Returns $ (cash flows CF t ) Income 0 - 5
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The rules 1. Determine what is V(CF t , time, risk) asic ol NPV lready nown ` Basic tool: NPV (already known) ` Work on INVESTMENTS vestments 1 V=-I 0 + Σ t CF t /(1+k) t ` Define risk ` Define performance ` Find improvements Investments 1 Investments 2 ` On cash flows ` On risk ork n ECURITIES Short term finance ` Work on SECURITIES ` Find best mix debt/equity (2 dimensions) `
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This note was uploaded on 11/06/2011 for the course ECONOMICS ebc2034 taught by Professor Vaartjes during the Spring '11 term at Maastricht.

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fmp201112_intro - Financial Financial Management and Policy...

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