Cover -- Contents -- PART 1 INTRODUCTION -- Chapter 1 The Corporation -- 1.1 The Types of Firms -- Sole Proprietorships -- Partnerships -- Limited Liability Companies -- Features of Corporations -- Tax Implications for Corporate Entities -- Corporate Taxation Around the World -- 1.2 Ownership Versus Control of Corporations -- The Corporate Management Team -- INTERVIEW with David Viniar -- The Financial Manager -- GLOBAL FINANCIAL CRISIS: The Dodd-Frank Act -- The Goal of the Firm -- The Firm and Society -- Ethics and Incentives within Corporations -- GLOBAL FINANCIAL CRISIS: The Dodd-Frank Act on Corporate Compensation and Governance -- Citizens United v. Federal Election Commission -- Airlines in Bankruptcy -- 1.3 The Stock Market -- Primary and Secondary Stock Markets -- The Largest Stock Markets -- INTERVIEW with Jean-François -- NYSE -- Over-the-Counter Stock Markets -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Chapter 2 Introduction to Financial Statement Analysis: IFRS -- 2.1 Firms' Disclosure of Financial Information -- Preparation of Financial Statements -- International Financial Reporting Standards -- INTERVIEW with Sue Frieden -- Types of Financial Statements -- 2.2 The Balance Sheet or Statement of Financial Position -- Assets -- Liabilities -- Shareholders' Equity -- Market Value Versus Book Value -- Enterprise Value -- 2.3 The Income Statement -- Earnings Calculations -- 2.4 The Statement of Cash Flows -- Operating Activity -- Investment Activity -- Financing Activity -- 2.5 Other Financial Statement Information -- Statement of Changes in Shareholders' Equity -- Management Discussion and Analysis -- Notes to the Financial Statements -- 2.6 Financial Statement Analysis -- Profitability Ratios -- Liquidity Ratios -- Working Capital Ratios -- Interest Coverage Ratios -- Leverage (Gearing) Ratios -- Valuation Ratios.

COMMON MISTAKE: Mismatched Ratios -- Investment Returns -- The DuPont Identity -- 2.7 Financial Reporting in Practice -- Enron -- WorldCom -- Sarbanes-Oxley Act -- GLOBAL FINANCIAL CRISIS: Bernard Madoff's Ponzi Scheme -- Dodd-Frank Act -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Data Case -- Chapter 3 Financial Decision Making and the Law of One Price -- 3.1 Valuing Decisions -- Analyzing Costs and Benefits -- Using Market Prices to Determine Cash Values -- When Competitive Market Prices Are Not Available -- 3.2 Interest Rates and the Time Value of Money -- The Time Value of Money -- The Interest Rate: An Exchange Rate Across Time -- 3.3 Present Value and the NPV Decision Rule -- Net Present Value -- The NPV Decision Rule -- NPV and Cash Needs -- 3.4 Arbitrage and the Law of One Price -- Arbitrage -- NASDAQ SOES Bandits -- Law of One Price -- 3.5 No-Arbitrage and Security Prices -- Valuing a Security with the Law of One Price -- An Old Joke -- The NPV of Trading Securities and Firm Decision Making -- Valuing a Portfolio -- Stock Index Arbitrage -- GLOBAL FINANCIAL CRISIS: Liquidity and the Informational Role of Prices -- Where Do We Go from Here? -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Appendix: The Price of Risk -- Arbitrage with Transactions Costs -- MyFinanceLab -- Key Terms -- Problems -- PART 2 TIME, MONEY, AND INTEREST RATES -- Chapter 4 The Time Value of Money -- 4.1 The Timeline -- 4.2 The Three Rules of Time Travel -- Rule 1: Comparing and Combining Values -- Rule 2: Moving Cash Flows Forward in Time -- Rule 3: Moving Cash Flows Back in Time -- Rule of 72 -- Applying the Rules of Time Travel -- 4.3 Valuing a Stream of Cash Flows -- 4.4 Calculating the Net Present Value -- USING EXCEL: Calculating Present Values in Excel -- 4.5 Perpetuities and Annuities -- Perpetuities.

Historical Examples of Perpetuities -- COMMON MISTAKE: Discounting One Too Many Times -- Annuities -- Growing Cash Flows -- 4.6 Using an Annuity Spreadsheet or Calculator -- 4.7 Non-Annual Cash Flows -- 4.8 Solving for the Cash Payments -- 4.9 The Internal Rate of Return -- USING EXCEL: Excel's IRR Function -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Data Case -- Appendix: Solving for the Number of Periods -- Problems -- Chapter 5 Interest Rates -- 5.1 Interest Rate Quotes and Adjustments -- The Effective Annual Rate -- COMMON MISTAKE: Using the Wrong Discount Rate in the Annuity Formula -- Annual Percentage Rates -- 5.2 Application: Discount Rates and Loans -- GLOBAL FINANCIAL CRISIS: Teaser Rates and Subprime Loans -- 5.3 The Determinants of Interest Rates -- Inflation and Real Versus Nominal Rates -- Investment and Interest Rate Policy -- The Yield Curve and Discount Rates -- COMMON MISTAKE: Using the Annuity Formula When Discount Rates Vary by Maturity -- The Yield Curve and the Economy -- INTERVIEW with Kevin M. Warsh -- 5.4 Risk and Taxes -- Risk and Interest Rates -- After-Tax Interest Rates -- 5.5 The Opportunity Cost of Capital -- COMMON MISTAKE: States Dig a 3 Trillion Hole by Discounting at the Wrong Rate -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Appendix Continuous Rates and Cash Flows -- Chapter 6 Valuing Bonds -- 6.1 Bond Cash Flows, Prices, and Yields -- Bond Terminology -- Zero-Coupon Bonds -- GLOBAL FINANCIAL CRISIS: Pure Discount Bonds Trading at a Premium -- Coupon Bonds -- 6.2 Dynamic Behavior of Bond Prices -- Discounts and Premiums -- Time and Bond Prices -- Interest Rate Changes and Bond Prices -- Clean and Dirty Prices for Coupon Bonds -- 6.3 The Yield Curve and Bond Arbitrage -- Replicating a Coupon Bond -- Valuing a Coupon Bond Using Zero-Coupon Yields -- Coupon Bond Yields.

Treasury Yield Curves -- 6.4 Corporate Bonds -- Corporate Bond Yields -- Are Treasuries Really Default-Free Securities? -- Bond Ratings -- Corporate Yield Curves -- 6.5 Sovereign Bonds -- GLOBAL FINANCIAL CRISIS: Credit Crisis and Bond Yields -- GLOBAL FINANCIAL CRISIS: European Sovereign Debt Yields: A Puzzle -- INTERVIEW with Carmen M. Reinhart -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Data Case -- Appendix: Forward Interest Rates -- Key Terms -- Problems -- PART 3 VALUING PROJECTS AND FIRMS -- Chapter 7 Investment Decision Rules -- 7.1 NPV and Stand-Alone Projects -- Applying the NPV Rule -- The NPV Profile and IRR -- Alternative Rules Versus the NPV Rule -- INTERVIEW with Dick Grannis -- 7.2 The Internal Rate of Return Rule -- Applying the IRR Rule -- Pitfall #1: Delayed Investments -- Pitfall #2: Multiple IRRs -- Pitfall #3: Nonexistent IRR -- COMMOM MISTAKE: IRR Versus the IRR Rule -- 7.3 The Payback Rule -- Applying the Payback Rule -- Payback Rule Pitfalls in Practice -- Why Do Rules Other Than the NPV Rule Persist? -- 7.4 Choosing Between Projects -- NPV Rule and Mutually Exclusive Investments -- IRR Rule and Mutually Exclusive Investments -- The Incremental IRR -- When Can Returns Be Compared? -- COMMOM MISTAKE: IRR and Project Financing -- 7.5 Project Selection with Resource Constraints -- Evaluating Projects with Different Resource Requirements -- Profitability Index -- Shortcomings of the Profitability Index -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Data Case -- Appendix: Computing the NPV Profile Using Excel's Data Table Function -- Chapter 8 Fundamentals of Capital Budgeting -- 8.1 Forecasting Earnings -- Revenue and Cost Estimates -- Incremental Earnings Forecast -- Indirect Effects on Incremental Earnings -- COMMOM MISTAKE: The Opportunity Cost of an Idle Asset.

Sunk Costs and Incremental Earnings -- The Sunk Cost Fallacy -- Real-World Complexities -- 8.2 Determining Free Cash Flow and NPV -- Calculating Free Cash Flow from Earnings -- Calculating Free Cash Flow Directly -- Calculating the NPV -- USING EXCEL: Capital Budgeting Using a Spreadsheet Program -- 8.3 Choosing Among Alternatives -- Evaluating Manufacturing Alternatives -- Comparing Free Cash Flows for Cisco's Alternatives -- 8.4 Further Adjustments to Free Cash Flow -- GLOBAL FINANCIAL CRISIS: The American Recovery and Reinvestment Act of 2009 -- 8.5 Analyzing the Project -- Break-Even Analysis -- Sensitivity Analysis -- GLOBAL FINANCIAL CRISIS: with David Holland -- Scenario Analysis -- USING EXCEL: Project Analysis Using Excel -- MyFinanceLab -- Key Terms -- Further Reading -- Problems -- Data Case -- Appendix MACRS Depreciation -- Chapter 9 Valuing Stocks -- 9.1 The Dividend-Discount Model -- A One-Year Investor -- Dividend Yields, Capital Gains, and Total Returns -- The Mechanics of a Short Sale -- A Multiyear Investor -- The Dividend-Discount Model Equation -- 9.2 Applying the Dividend-Discount Model -- Constant Dividend Growth -- Dividends Versus Investment and Growth -- John Burr Williams' Theory of Investment Value -- Changing Growth Rates -- Limitations of the Dividend-Discount Model -- 9.3 Total Payout and Free Cash Flow Valuation Models -- Share Repurchases and the Total Payout Model -- The Discounted Free Cash Flow Model -- 9.4 Valuation Based on Comparable Firms -- Valuation Multiples -- Limitations of Multiples -- Comparison with Discounted Cash Flow Methods -- Stock Valuation Techniques: The Final Word -- INTERVIEW with Douglas Kehring -- 9.5 Information, Competition, and Stock Prices -- Information in Stock Prices -- Competition and Efficient Markets -- Lessons for Investors and Corporate Managers.

Kenneth Cole Productions-What Happened?.

For MBA/graduate students taking a course in corporate finance.   This Global Edition has been edited to include enhancements making it more relevant to students outside the United States   Using the unifying valuation framework based on the Law of One Price, top researchers Jonathan Berk and Peter DeMarzo set the new standard for corporate finance textbooks. Corporate Finance blends coverage of time-tested principles and the latest advancements with the practical perspective of the financial manager. With this ideal melding of the core with modern topics, innovation with proven pedagogy, Berk and DeMarzo establish the new canon in finance.   For programs and professors who would like a streamlined book that is specifically tailored to the topics covered in the first one-semester course, Corporate Finance: The Core is also available by Jonathan Berk and Peter DeMarzo.

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Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2022. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.