University of Waterloo - AFM 274: Introduction to Corporate Finance (Solutions)

AFM 274: Introduction to Corporate Finance builds on the concepts from AFM 273. In this course, students learn how changes in a firm's capital structure and payout policy affect its value. They also estimate project and firm values using free cash flow forecasts under different financing scenarios, such as all-equity and leveraged financing. The course covers how both private and public firms raise capital, including equity and debt financing. Additionally, it explores working capital management and helps students understand how to estimate a firm's short-term financing needs. In this course, students explore key concepts essential for understanding corporate finance. The course covers risk and return, examining how these factors influence investment decisions. It also delves into capital structure in perfect capital markets, highlighting the effects of debt and taxes on corporate finance. Other critical topics include financial distress, managerial incentives, and information asymmetry, along with payout policy, capital budgeting, and valuation with leverage. Students will also learn about equity and debt financing, as well as working capital management and short-term financial planning, providing a comprehensive overview of financial decision-making in corporations.

Prerequisites: AFM 272 or AFM 273.
Antirequisites: ACTSC 372, ACTSC 391, AFM 275, ECON 371, or AFM 392.